Opening of Special Non-Resident Rupee Account-RBI expands the permitted uses of the SNRR Account
Opening of Special Non-Resident Rupee Account
Opening, holding and maintaining foreign currency accounts by a person resident in India is regulated in terms of section 9 of the Foreign Exchange Management Act, 1999 (FEMA).
Under the current Regulations, any person resident outside India, having a business interest in India, may open a Special Non-Resident Rupee Account (SNRR account) with an authorised dealer for the purpose of putting through bona fide transactions in rupees.
The RBI, with a view to promote the usage of INR products by persons resident outside India, has decided to expand the scope of SNRR Account by permitting person resident outside India to open such account for following purposes:
(i) External Commercial Borrowings in INR;
(ii) Trade Credits in INR;
(iii) Trade (Export/ Import) Invoicing in INR; and
(iv) Business related transactions outside International Financial Service Centre (IFSC) by IFSC units at GIFT city like administrative expenses in INR outside IFSC, INR amount from sale of scrap, government incentives in INR, etc. The account will be maintained with bank in India (outside IFSC).
Certain other provisions for operation of the SNRR Account have also been rationalised:
(a) Remove the restriction on the tenure of the SNRR account opened for the purposes given at paragraph 3 above as the proposed transactions are more enduring in nature.
(b) Apart from Non-Resident Ordinary (NRO) Account, permit credit of amount due/ payable to non-resident nominee from account of a deceased account holder to Non-Resident External (NRE) Account or direct remittance outside India through normal banking channels.
However, as per the Notification issued in this regard, the required permissions / approvals shall remain unchanged.
- CARO 2020- MCA notifies Companies (Auditor’s Report) Order 2020. Key Changes
- Addition u/s 56(2)(ii) deleted as Law cannot ignore ground realities despite a deeming fiction
- Mauritius included in FATF list of “jurisdictions under increased monitoring” – SEBI
- Govt. Constitutes 22nd Law Commission of India for a term of three years- Read Order
- Non striking of limb of penalty u/s 271(1)(c). Appeal to be restored on favourable judgment by SC