presentation on fama, 1939

8/9/2019 Presentation on FAMA, 1939

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PresentationPresentation

onon

Foreign ExchangeForeign Exchange

Management Act, 1939Management Act, 1939


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Foreign Exchange Management Act, 1939

Foreign Exchange Management Act was 1st introduced inSeptember, 1939 in INDIA.

For the smooth functioning FEMA was converted intoForeign Exchange Regulation Act in 1973.

INTRODUCTIONINTRODUCTION

27 year laterFERA was replaced in FEMA by the fewproblems in 1st June, 2000.


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ContCont

Specially the Foreign Exchange Regulation was firstlyintroduced in 1947 and converted in FERA in 1973 and

in the end replaced by FEMA in June 1st , 2000.


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Uses of FEMAUses of FEMA

This act was introduced for the foreign exchange regulationon outside the India by the Indian companies and in India

by the Foreign companies.

The FEMA was introduced specially for facilitate the externaltrade and payments.


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FEMA had assigned the RBI for the administration of thisAct and working with Central Government Employees forholding the enquires.

Specially the FERA was introduced for the control of all theeconomic activities by the proper utilization of ForeignExchange resources.


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Foreign ExchangeForeig

n Exchange

Foreign exchange means the dealings of import and exportfrom our country to another country or from other countryto our country by the currency of the other country and ournation.

Special points for foreign exchange:vDeposits

vCheques

vCredit

vBills Payable

vBills receivable


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Foreign CurrencyForeign Currency

Foreign currency means any currency other than Indiancurrency.

(OR)

According to Section 6(4) a person resident in India mayhold, own transfer or invest in foreign currency situatedoutside India, if such currency was acquired , held orowned by such person when he was residing outside Indiaor inherited from a person who was residing outside India.


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Foreign SecurityForeign Security

Foreign security means any security in the form of shares,bonds, stocks, debentures or any other instrumentsexpressed in foreign currency.

(OR)According to Section 6(4) a person resident in India may

hold, own transfer or invest in foreign security or propertysituated outside India, if such security or property wasacquired , held or owned by such person when he wasresiding outside India or inherited from a person who wasresiding outside India.


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PersonPerson

A person includes:

qAn individual

qA company

qA firm

qAn association of person or body of individuals

qAny agency

qOffice or branch owned or controlled by such person.


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Authorized Person Authorized Person

According to Section 2(c) an authorized person means anauthorized dealer, moneychanger, or any other personauthorized under the act to deal in foreign exchange.

An authorization Under this section shall be in writing andshall be subject to the conditions laid down therein.

An authorization under sub section (1) may be revoked by theReserve Bank Of India at any time if the RBI is satisfied.


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Person Resident in IndiaPerson Resident in India

A person residing in India for more than 182 days during thecourse of the proceeding financial year but does notinclude:

1. A person who has gone out of India or who stays outsideIndia in either case:

I. For taking up employment outside India.

II.For carrying on outside India a business or vacation outside

India.III.For any other purpose, if it is indicated that his intention to

stay outside India for an uncertain period.

4.


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2. A person who has come or stays in India, in either case:

I. For taking up employment in India.

II.For carrying a business or vacation in India.

III.Any office, branch or agency in India owned or controlledby a person resident outside India.

IV.For any other purpose if is indicated that his intention to stayin India for an uncertain period.

3. Person resident outside India means a person who is notresident in India.

I.

ContCont


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Extend and Application of FEMAExtend and Application of FEMA

It applies to all over India expect Jammu & Kashmir.

It applies to all branches.


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Few important BranchesFew important Branches

1. Dealing in Foreign Exchange: No person accept with the general or special permission

ofRBI shall deal in or transfer any foreign exchange.

2. Holding of Foreign Exchange: Without the permission of RBI no person resident in

Indiashall hold, own or transfer any foreign exchange or acquireany immovable property outside India.


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3. Export of Goods & Services: Before exporting the goods & services shall have to takethe permission of Reserve Bank Of India. And everyinformation should be true.4. Realization & Repatriation of Foreign Exchange: (The native returning to the native place.)A person resident in India shall take all the reasonable step torealize and repatriate the Foreign Exchange but only under theconsideration of RBI.

ContCont


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Contravention & PenaltiesContravention & Penalties

1. Penalties for Contravention:

Under FEMA the penalties is thrice the sum involved .

If the contravention continue then the penalty of Rs. 5000 perday shall be imposed.

2. Enforcement of orders on adjudicating Authority (AA):

If a person fails to make payment of penalty within 90 daysthen he is liable for civil imprisonment.


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The civil imprisonment is up to 3 years.(If the penalty has notbeen given by the person in time)

In case of non payment the imprisonment can be exceedaccording to the desire of the authority.

The arrest warrant can also be issued by the authority.


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Appeal & AdjudicationAppeal & Adjudication

1. Adjudicating Authority (AA):

The central government is empowered to appointadjudicating authority for holding inquiries in their

respective area only on a complement make in writing.

Authorities have a powers of civil court.

All the complaints are to be disposed of finally with in oneyear, otherwise the reasons are to be given in writing.


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ContCont

2. Appeal to Special Director:

The central government appoints special director.

All the appeals as per the order of adjudicating authority.

The appeal shall be filed within the 45 days from the receiptof the order.


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3. Appellate Tribunal:

It is established by the central government to hear appealsagainst the Adjudicating Authority & Special Director.

The appeal shall be filed within the 45 days from the receiptof the order of AA or SD.

ContCont


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3. Appellate Tribunal:

The Appellate Tribunal is not bound by the procedure latedown by the court of civil procedure.

It shall be guided by the principle of natural justice and shallhas powers to lay down their own procedure.


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THANK YOU

&HAVE A NICE DAY

presentation on fama, 1939

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