Export of goods outside india & inr invoice to indian client

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Vinay (Querist)

29 July 2015 Good day,

I have trading company dealing in Ship spare parts. i have 2 query :-

1) My client is in India(Ship Owners) but their ship is trading in Foreign waters, they gave me order for purchase & supply of engine part from Korea to Singapore, i paid to my supplier through bank in USD & raised invoice to India client in INR, now my bank wants inward also in foreign currency. But India client cannot pay in INR as both are in India

2) to the same client i supplied spares from India to Dubai by proper export channel & have customs copy, where as all are tax exempted against H form, i did the export with my IEC code, Invoiced to client in INR as same mentioned in my customs docs, now again bank is saying for any export from India inward must be in foreign currency & not ready to close the case.

pl. guide with correct procedure

Best regards

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

29 July 2015 1 Your client may be in India but you supplied engine part to Singapore, so you should receive payment in foreign currency your bankers is right in demanding foreign currency.
2 The bankers are right in saying that payments for exports be made in foreign currency.

Vinay

Vinay (Querist)

29 July 2015 Good day

for 1) But when both buyer & seller are in India then how can they make payment in Foreign currency.

2) Again same, client is based in India, we have moved the spares as to reach on board his vessel which is trading in foreign waters.

can i request for your contact no. so i can call to clarify the procedure

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

29 July 2015 Buyer and seller may be in India but supplies made to foreign country as RBI regulations payment has to be received in foreign currency.

Guest

Guest (Expert)

22 February 2016 Dear Vinay, I beg to differ. It is possible to realise export proceeds in INR According to RBI master circular on export. Further there can be export only if goods are taken out of India - according to definition in FEMA. You can show the RBI master circular in this regard.

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