It describes the recent procedural changes made related to Foreign payments.

1. Foreign remittance – procedural changes
Blue Consulting Pvt. Ltd.
Doing common things, Uncommonly well.
July 13’ 2009 Blue Consulting Pvt. Ltd.
A Finance & Accounts outsourcing company
A Finance & Accounts Outsourcing Company

2. Context
Blue Consulting Pvt. Ltd.
(A Finance & Accounts Outsourcing Company)
2 www.blueconsulting.co.in
Hi,
You may please be aware that w.e.f. 1st July’2009, a remitter
is required to fill an online Form 15CA on the website www.tin-
nsdl.com before making any foreign remittance.
In the last few days, we have received many queries and
inquiries related to online submission of Form 15CA.
In the next few pages, we have tried to address those queries
by providing the background of documentation and procedure
of documentation (with the help of a diagram).
Trust, it would be useful to you.
Regards,
Chandan Goyal

3. Background of documentation
Blue Consulting Pvt. Ltd.
(A Finance & Accounts Outsourcing Company)
3 www.blueconsulting.co.in
 As per initial understanding of Section 195 of the Income Tax Act,
1961 (‘Act’), an undertaking from the remitter and a certificate from
a practicing Chartered Accountant (CA) was required for a foreign
remittance where TDS (withholding tax) was deductible as per the
provisions of Section 195 of the Act.
 Accordingly, Reserve Bank of India (RBI) advised all the authorized
banks to obtain the aforesaid undertaking and certificate from the
remitter before making any foreign remittance.
 Few authorized banks enquired from RBI whether they are required
to obtain the aforesaid undertaking and certificate for each and every
foreign remittance including the trade remittance.
 RBI clarified with Central Board of Direct Tax (CBDT) about it and
CBDT replied that aforesaid undertaking and certificate shall be
required for every foreign remittance (other than Salary)
because Section 195 of the IT Act is not limited to interest income
and it takes into account business income also.

4. …contd.
Blue Consulting Pvt. Ltd.
(A Finance & Accounts Outsourcing Company)
4 www.blueconsulting.co.in
 Accordingly, RBI issued A. P. (DIR Series) Circular No. 03 Dated
July 19,2007 to all the authorized banks and instructed them to
obtain an undertaking and CA certificate from remitter for each and
every foreign remittance covered under Section 195 of the Act.
 Substantial increase in foreign remittances made the manual
handling and tracking of certificates difficult for the Income Tax
Department. To monitor and track transactions in a timely manner,
Section 195 was amended vide Finance Act, 2008 by inserting Sub
Section (6) to allow CBDT to prescribe rules for electronic filing of
the undertaking.
 CBDT notified the rules (Rule 37BB) for electronic filing through
Notification No. 30/2009 [F. NO. 142/19/2007-TPL]/S.O. 857(E),
DATED 25-3-2009 which prescribed two forms 15CA (for
electronic filing) and Form 15CB (format of CA certificate) to be
effective from 1st July’2009.
 Recently, CBDT came out with a Circular No. 04/2009 dated 29th
June’2009 which prescribed the procedure for furnishing
information regarding remittances being made to non-residents.

5. Revised procedure at a glance
Blue Consulting Pvt. Ltd.
(A Finance & Accounts Outsourcing Company)
5 www.blueconsulting.co.in
1. Click on the option:
Obtain a certificate from CA in Access the website to fill Form
E-Furnish : Form 15CA
Remitter Form 15CB for the foreign 15CA
remittance to be made 2. Choose ‘Generation of
www.tin-nsdl.com
Form 15CA’
Fill up the Form 15CA: After filling up the complete Sign this form. It needs to be
Part A- It requires Take print out of the Form 15CA signed by the person who is
information in Form 15CA,
information about Remitter, which shall be system authorized to sign the annual
Beneficiary and CA. submit the form as per the
generated and bear an income tax return of the
Part B – It is a replica of Form instructions given on the acknowledgement no. remitter or a person duly
15CB webpage authorized by him in writing.
Submit the signed Form 15CA
and Form 15CB in duplicate to Bank will forward a copy of
Bank will remit the amount to
the bank along with other Form 15CA and 15CB to the
the non-resident
payment related documents i.e. Assessing Officer of remitter
invoice, FEMA declaration etc.

6. Important points
Blue Consulting Pvt. Ltd.
(A Finance & Accounts Outsourcing Company)
6 www.blueconsulting.co.in
1. There is some misunderstanding regarding submission of system generated copy of 15CA with the Income Tax Department. From the
plain reading of Notification No. 30/2009 dated 25-03-09, it appears that signed copy of Form 15CA (system generated) is also to be
submitted with the Income Tax department by the remitter. However, Circular No. 04/2009 dated 29th June’2009 make it amply clear
that remitter need not to submit the signed copy of Form 15CA (system generated) to the Income tax department. Remitter will only
submit it to the bank and a copy of signed Form 15CA shall be forwarded by that bank to the Assessing Officer of the remitter.
2. As per above referred Circular, a remitter who has obtained a certificate from the Assessing Officer regarding the rate at or
amount on which tax is to be deducted is not required to obtain a certificate from the CA in Form 15CB.
However, he is required to furnish the information in Form 15CA and submit it along with a copy of the certificate from the Assessing
Officer as per procedure mentioned on the previous page.

7. About us Blue Consulting provides value added and high
quality Finance & Accounts Outsourcing Services
Blue Consulting Pvt. Ltd.
through its contemporary onsite service delivery
(A Finance & Accounts Outsourcing Company)
7 model. Our goal is to be a trusted partner in your
www.blueconsulting.co.in
business by bringing value and serving as an
integral part of your set up.
For any professional advise required in relation to budget
provisions, please contact us : Blue Consulting, or BC, has its roots in a well
established, four decade old chartered accountants
firm. Utilizing forty years of industry experience and
Chandan Goyal functional expertise, BC looks innovatively beyond
Director- Business Development standard solutions to develop new insights, drive
tangible results, and empower clients to achieve
chandan.goyal@blueconsulting.co.in
greater results.
+91 98104 10421 For further detail, please log on to:
+91 120 4230649 www.blueconsulting.co.in
Delhi Pune
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Disclaimer
This publication is intended as a service to clients to update them about important provisions related to documentation part of foreign remittances. It has been prepared for
general guidance on matters of interest only, and does not constitute professional advice. No person should act upon the information contained in this publication without
obtaining specific professional advice. Due care has been taken while compiling the information however no representation or warranty (express or implied) is given as to the
accuracy or completeness of the information contained in this publication