LALIT CHHAJED (PARTNER) (30 Points)
22 August 2011An Indian Company is planning to procure a sum of USD 1 million towards subscriptttion of CCD from a foreign Company. In this regards we would request your advise for the procedures and documentation.
Also request your advise if these funds can be utilised by the Indian Company for purchase of shares of another company.?
Sudhag
(Chartered Accountant and Company Secreta)
(1231 Points)
Replied 29 September 2011
(1) For first part of your question : within 30 days of receipt of money file with RBI though AD annexure ii and iii. The capital instruments should be issued within 180 days from the date of receipt of the
inward remittance or by debit to the NRE/FCNR (B) account of the non-resident investor. Within 30 days of allotment Form FC GPR to be filed.Please see the attached for details. https://www.wirc-icai.org/(S(4113a33ixtiiyeyjlj3rymu5))/material/Due%20Diligence%20under%20FEMA%20by%20CA.%20Sudha%20G.%20Bhushan.pdf
(2) I will request you to check the NBFC guidelines and regulations relating to downstream investment for second part of your question.
Hope above helps.
Regards,
CA. Sudha G. Bhushan
Sudhag999 @ gmail.com
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