Reserve Bank has granted general permission to any person to bring foreign currency into India from any place outside India without limit, provided he declares to Customs authorities on arrival the particulars of all such foreign currency brought in by him on the Currency Declaration Form (CDF). However, if the aggregate value of foreign currency brought in by him in the form of currency notes, bank notes or travellers cheques does not exceed U.S.$ 10,000 or its equivalent, and/or the value of foreign currency notes does not exceed U.S.$ 5000 or its equivalent, CDF is not required to be completed.
NOTE: Bringing in or sending into India of foreign coins is exempt from the prohibition contained in Section 13(1) of FERA 1973 by virtue of Central Government Notification No. F1/107/EC/73 dated 1st January 1974.
[ANX-I] ANNEXURE
Guidelines for Handling Import Bills - Operating Procedure
[Paragraph 7A.21]
1. The Operating Procedure is aimed at checking the incidence of fraudulent Import Bills, i.e., Bills which are drawn against non-existent imports and almost all documents notably Invoice(s), Bills of Lading/Airway Bills and Bills of Entry are fake. From the Exchange Control perspective,the risk of fradulent import bills is highest in the case of bills received on collection basis, particularly those relating to new/relatively new customers or customers who do not avail of any credit facilities from the authorised dealer or customers whose business-relationship with the bank is by and large restricted only to the retiring of import bills. Having regard to this, the business bonafides of Importer-customers have to be carefully verified. Instructions on the disposal/payment of import bills should be given at a sufficiently senior level at the branch i.e., by Branch Manager or a Senior Officer in Scale IV. These directions should be given in writing in the Import Bills Register and the reasons for the decision taken should be clearly recorded.
2. Unless the competent senior officer of the bank i.e., Branch Manager or Senior Scale IV Officer, is fully satisfied about the financial status/standing of the importer by virtue of long-established track-record, the concerned authorised dealer should arrange to obtain a Bankers Report on the overseas seller. The Report from overseas bankers/reputed credit Agency (like, Dun and Bradstreet) should, inter-alia, specifically comment on whether the seller-firm is ordinarily engaged in purchase/sale of goods sought to be exported to India and whether the seller is good for ordinary business engagements.
3. As a general rule import bills and documents should be received from the banker of the seller by the banker of the buyer in India. Authorised dealers should not, therefore, make remittances where import bills received directly by the importers from the overseas seller, except in the following cases:
(a) Where the value of import bill does not exceed U.S.$ 10,000/-
(b) Import bills received by wholly-owned Indian subsidiaries of foreign companies from their principals
(c) Import bills received by Super Star Trading Houses, Star Trading Houses, Trading Houses, Export Houses,100% Export Oriented Units/Units in Free Trade Zones, Public Sector Undertakings and Public Limited Companies.
(d) Where the value of import bill does not exceed U.S.$ 25,000 in respect of import of -
(i) books and magazines
(ii) life saving drugs/equipments by Hospitals, etc. and
(iii) Imports by reputed research and other development institutions like Tata Institute of Fundamental Research, C-DOT, Indian Institute of Technology, Indian Institute of Science & University.
e) Import bills received by all limited companies viz. public limited, deemed public limited and private limited companies.
4. In all other cases, at the request of importer clients, authorised dealers may receive bills direct from the overseas seller up to U.S.$ 25,000 (U.S. Dollars Twenty five thousand only), provided the Competent Officer i.e. Branch Manager or Senior Officer in Scale IV is fully satisfied about the financial standing/status and track record of the importer customer. Beffore extending the facility, authorised dealer should obtain report on each individual overseas seller from the overseas banker or reputed credit agency.
5. (a) As stated above, instructions on the disposal/payment of import bills should be given at the level of Branch Manager or a Senior Scale IV taking into consideration the following aspects:
i) Is the Indian customer banking with the concerned branch for a reasonably long period of time.
ii) Whether the customer has availed of credit facilities from the branch.
iii) Whether the bank has at any time examined the balance-sheet of the customer.
iv) Is the customer an established dealer/trader/user of the goods sought to be imported.
v) Whether the place of business/godowns etc. of the importer have been visited/inspected by the bank.
vi) Whether sales of the importing firm are regularly credited to its business account or there are only occasional credits to the account. It should be also ascertained whether credits are mostly by way of cash deposits, and also whether non-cash deposits represent mostly pay-orders/drafts/cheques drawn on other branches/branches of other banks by the importer; if so, whether credits represent normal business funds or simple transfer of funds from one account to another account.
Authorised dealers should maintain a separate Import Bills Register to record full particulars in chronological order of import bills received direct from the sellers. Brief comments covering these points must be given in the Import Bills Register so that Inspecting Officials are in a position to suitably cross-check at a later date. The Register should be scrutinised by the internal auditors during the audit and adverse features, if any, noticed should be incorporated in their Report.
(b) Based on the above, and taking into account the track record and financial position of the importer, the competent officer of the bank should take a decision on the handling/retirement of the import bills.
In case of doubt, the authorised dealer should, inter-alia, insist on:
(i) Detailed verification of the importers books of accounts.
(ii) Inspection of importers place of work.
(iii) Enquiries with some of the leading customers of the importer for establishing his business bona fides.
(iv) A comprehensive and wholly satisfactory Opinion Report from the bankers of the overseas seller.
6. Authorised dealers may consider the feasibility/desirability of restricting the business of handling import documents to`A and `B category branches only. At centres where authorised dealers have a number of `A and `B category branches, this restriction may not lead to operational inconvenience for customers. In cases where documents are received/handled by `C category branches, the concerned `A/`B category branch which has to effect the remittance must insist on a detailed status Report cum Certificate from the Branch Manager of the `C category branch. Where warranted, the `A/`B category Branch Manager may depute an officer to make detailed enquiries at the `C category branch to establish bona fides of the customer.
7. Authorised dealers should not view the above procedural precautions as being relevant only to import bills received on collection basis. Since fraudulent import bills can be the handiwork of cash-rich persons and their front-firms, it is not difficult for such firms to open Letters of Credit favouring overseas nominees with cash margin even upto 100%. In all such cases, authorised dealers must note to follow the procedural drill detailed above so that the financial antecedents of the Indian importer and the overseas seller are clearly established.
8. Authorised dealers must instruct the operating staff to scrutinise the Bills of Entry presented by importers with particular care. Though it is unlikely that a prima-facie scrutiny can reveal the authenticity or otherwise of a Bill of Entry, yet on occasions obvious inconsistencies/inaccuracies can be noticed which should put the bank-staff on further enquiry. Branch Manager/Senior Scale IV Officer may also, at his discretion and particularly in respect of new/relatively new accounts through which import bills are being routed, send copies of a few Bills of Entry at random basis for verification to the concerned office of Customs and follow up promptly for confirmation or report from them. All such correspondence should be kept on records for verification by the internal auditors and inspecting officials of Reserve Bank.