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This article speaks about the notification released by the Reserve Bank of India, about the FEMA Guidelines for Export of Goods and Services through amendment regulations of 2021. RBI releases the notification concerning amending FEMA (Export of Goods & Services) Regulations 2015 under the FEMA Notification No. FEMA 23(R)/2015-RBI dated January 12, 2016, referred to as the Principal Regulation. The notification came into effect from January 8, 2021. The notification is the positive change for the registered users of Foreign exchange Regulations.
Table of Contents
The notification says that, in the exercise of the powers conferred by Clause (a) of Sub-Section (1), sub-section (3) of section 7 and Clause (b) of subsection (2) of section 47of the Foreign Exchange Management Act, 1999[1], the Reserve Bank of India, makes the following amendments, in the FEMA-Foreign Exchange Management (Export of Goods & Services) Regulations, 2015, which is referred to as Principal regulations.
As given in the Principal Regulation that is Regulation Number 4 of sub-regulation (ea), the following words which have been substituted as follows-
That re-export of Goods of leased aircraft/helicopter/and/or engines/auxiliary power units APUs, either entirely, or in partially knocked down conditions, repossessed by the overseas lessor, and duly de-registered by the Directorate General of Civil Aviation –DGCA on the request of the Irrevocable Deregistration and Export Request Authorisation-IRDEA holder under Cape Town Convention or any other termination or cancellation of the lease agreement between the lessor and lessee subject to permission by DGCA/Ministry of Civil Aviation for such exports.
As understanding the nature of the notification, it can be interpreted that, Regulation 4 of the Foreign Exchange Management (Export of Goods &Services), 2015, relates to the Exemption to the principle rule of Regulation 3- which speaks about how exports are declared. This Regulation is an exemption clause. It talks about the Exemption where declaration of exports of goods or software may be made without furnishing the declaration in the following cases. Those cases are elaborated under the Regulation 4.
The notification of 2021-FEMA guidelines for Export changed the Regulation 4 (e) clause. Clause (ea) has been added by the amendment of 2021. This Clause (e) of the 2015 Export of goods and service regulation was all about-
“it can be said that Aircraft or aircraft engines and spare parts for overhauling and or repairs abroad subject to the re-import in India after overhauling/repairs, within a period of 9 months from the date of the export”.
The notification of 2021 is different from the 2015 regulation. Clause e of regulation 4 of the guidelines, gave the Exemption for Export of goods or services for not furnishing any document while exporting. But Clause (ea)-added that while re-exporting an aircraft/helicopter/APU, mandatory permission of the lessor-lessee shall be subject to authorisation by DGCA/Ministry of Civil Aviation of Exports.
This requirement was not in the regulation of 2015, 2016 and 2020, but it has been added through the 2021 amendment.
Regulation 3 of FEMA guidelines for exports is about, the declaration of exports. This means what medium or items to be declared as exports.
The exemptions which are included in regulation 4, where no documents are to be furnished while exporting of goods or services:
It can be concluded that the notification speaks about aircraft/aircraft engines for overhauling and/or repairs abroad subject to their re-import into India after overhauling /repairs, within six months from the date of their Export. Such permission is reserved for the lessor & lessee in the contract to the DGCA. The notification is good news for aviation industry.
Read our article:FEMA Compliance on Export of Goods and Services
She is B.Com (H), LL.B LLM, Cs (Module 2) And Certification In Cyber Law From ILI Qualified. She has Been A Legal Teacher In The Previous Organization. My Strength Is My Expertise Knowledge In Civil Laws, Corporate Law And Tax Laws. I Have Been Legal Teacher And Legal Trainer In The Past Organization. Her Knowledge About The Subjects Have Expanded Due To Teaching Number Students From Various Universities All Over India.
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