Notifications are type of self-contained set of regulations, which are mostly divided into three broad parts
Short title and commencement Definitions and Other provisions It is interesting to note that the same term may be defined differently for different purposes in different Notifications. For example, the term “Person of Indian Origin (PIO)” is defined differently in three Notifications, namely FEMA 13/2000-RB pertaining to remittance of assets, FEMA 21/2000-RB pertaining to acquisition and transfer of immovable property in India and FEMA 24/2000-RB pertaining to investment in a firm or a proprietary concern in India. The definition section of each Notification makes it clear that the words and expressions used therein, but not defined in that particular Notification, shall have the same meanings respectively assigned to them in the Act. Therefore, wherever a particular term is defined in the Notification, the meaning to be assigned is unique to that Notification and mostly cannot be applied to another. Thus, interpretation and application of FEMA provisions and Notifications require utmost care. FEMA is applicable to the whole of India. The expression “whole of India” would indicate that the provisions of the Act are applicable to all transactions taking place in India. Thus, any person who is present in India at the time of transaction has to comply with provisions of FEMA. FEMA is applicable to all branches, offices and agencies outside India owned or controlled by a person resident in India. Thus, FEMA has retained its extra-territorial application, as under FERA. The Enforcement of FEMA is done through Reserve Bank of India and Central Government. The power has been given to Central Government [section 46] and RBI [Section 47] to lay down detailed rules and regulations to carry out the various provisions of the Act. Where under Section 47 the reserve bank of India can make regulations governing procedural and administrative aspects of FEMA the central government have been given the power to make rules governing enforcement of FEMA. The Central Government has established a Directorate of Enforcement for the purpose of enforcement of Act [section 36]. Officers under Directorate of enforcement are known as officers of Enforcement. These officers can investigate the contraventions of FEMA.
We at Taxpert Professionals ensure that our clients are FEMA Compliant and don’t attract any penalty under FEMA.