{"id":433,"date":"2015-09-25T11:41:10","date_gmt":"2015-09-25T06:11:10","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=433"},"modified":"2021-10-22T13:28:46","modified_gmt":"2021-10-22T07:58:46","slug":"advantage-of-foreign-inward-remittance-certification-firc","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/","title":{"rendered":"Advantage of  FIRC"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d28fc07bce7\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d28fc07bce7\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#Advantage_of_Foreign_Inward_Remittance_Certification_FIRC\" title=\"Advantage of Foreign Inward Remittance Certification (FIRC)\">Advantage of Foreign Inward Remittance Certification (FIRC)<\/a><ul class='ez-toc-list-level-2'><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#FOREIGN_INWARD_REMITTANCE_CERTIFICATE_FIRC\" title=\"FOREIGN INWARD REMITTANCE CERTIFICATE (FIRC)\">FOREIGN INWARD REMITTANCE CERTIFICATE (FIRC)<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#1_Introduction\" title=\"1. Introduction\">1. Introduction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#2_Purpose\" title=\"2. Purpose\">2. Purpose<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#3_Relevance\" title=\"3. Relevance\">3. Relevance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#4_Contents_and_issue_procedure\" title=\"4. Contents and issue procedure\u00a0\">4. Contents and issue procedure\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/advantage-of-foreign-inward-remittance-certification-firc\/#5_Conclusion\" title=\"5. Conclusion\">5. Conclusion<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/12\/18.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-1520\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/12\/18.png\" alt=\"www.carajput.com;Business setup outside India\" width=\"869\" height=\"509\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/12\/18.png 869w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/12\/18-300x176.png 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/12\/18-768x450.png 768w\" sizes=\"(max-width: 869px) 100vw, 869px\" \/><\/a><\/p>\n<h1><span class=\"ez-toc-section\" id=\"Advantage_of_Foreign_Inward_Remittance_Certification_FIRC\"><\/span><span style=\"color: #ff0000;\"><strong><em><u>Advantage of Foreign Inward Remittance Certification (FIRC)<\/u><\/em><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h1>\n<h2><span class=\"ez-toc-section\" id=\"FOREIGN_INWARD_REMITTANCE_CERTIFICATE_FIRC\"><\/span><span style=\"color: #000080;\"><strong>FOREIGN INWARD REMITTANCE CERTIFICATE (FIRC)<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3><span class=\"ez-toc-section\" id=\"1_Introduction\"><\/span><span style=\"color: #ff6600;\"><strong>1. Introduction<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\"><strong>\u00a0<\/strong>Foreign Inward Remittance Certificate (FIRC) is a document that provides proof of inward remittance to India.<\/p>\n<p style=\"text-align: justify;\">Such remittance could be either on account of Foreign Direct Investment (<a href=\"https:\/\/www.caindelhiindia.com\/blog\/implications-ma-more-secure-on-making-fdi-in-india-inflows\/\">FDI<\/a>) or towards export receivables or towards sale of securities by resident to a non resident.<\/p>\n<p style=\"text-align: justify;\">It is treated as documentary evidence by most of the statutory authorities for confirming the validity of the convertible foreign exchange received by the beneficiary.<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"2_Purpose\"><\/span><span style=\"color: #ff6600;\"><strong>2. Purpose<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">When a beneficiary receives fund from outside India, it will be credited to his account only through an Authorized Dealer (normally a Bank).<\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #3366ff;\"><strong>Authorized dealer<\/strong>\u00a0<\/span>means an authorized person by the Reserve Bank of India to deal in foreign exchange or in foreign securities under the\u00a0Foreign Exchange Management Act).<\/p>\n<p style=\"text-align: justify;\">If the bank, in which the beneficiary has an account, is not an Authorized Dealer, then the remittance needs to be received by the beneficiary through an Authorized Dealer.<\/p>\n<p style=\"text-align: justify;\">Based on the information provided by the beneficiary upon receipt of foreign remittance, the banker issues FIRC stating the purpose of receipt i.e. towards equity investment, advance against export of services \/ goods, capital expenditure etc.<\/p>\n<p><strong>Read the related links below;<\/strong><\/p>\n<ul>\n<li><strong><a href=\"https:\/\/carajput.com\/learn\/sebi-introduces-onetime-settlement-scheme-sebi-settlement-scheme-2020.html\">SEBI introduces onetime settlement scheme SEBI settlement scheme-2020<\/a><\/strong><\/li>\n<li><strong><a href=\"https:\/\/carajput.com\/blog\/sebi-guidelines-dvat-provisions-cbecs-move-towards-gst\/\">SEBI guidelines for DVAT Provision<\/a><\/strong><\/li>\n<li><strong><a href=\"https:\/\/carajput.com\/blog\/sebi-extends-time-line-for-june-quarter-results-to-15-sept-2020\/\">SEBI extended timelines for june quarter<\/a><\/strong><\/li>\n<li><strong><a href=\"https:\/\/carajput.com\/learn\/security-exchange-board-in-india-consultancy-service.html\">Service regarding SEBI<\/a><\/strong><\/li>\n<\/ul>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"3_Relevance\"><\/span><span style=\"color: #ff6600;\"><strong style=\"line-height: 1.5;\">3. Relevance<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\"><strong>\u00a0<\/strong>A few cases where FIRC assumes importance<\/p>\n<ol style=\"text-align: justify;\">\n<li>In case of Issue of Shares to a Foreign Entity\/person, FIRC is a proof for receipt of share application money.<\/li>\n<li>Similarly it is also proof that share purchase consideration has been received by a resident seller, in case of transfer of shares by a resident Indian to a non-resident buyer.<\/li>\n<li>Export of services there is no Service tax to be paid, subject to Export of Services Rules.<\/li>\n<li>Here again FIRC becomes a documentary proof for exports made and remittances received thereof in freely convertible foreign exchange.<\/li>\n<li>In export promotion schemes like Advance Licensed, EPCG (Export Promotion Capital Goods) etc., FIRC is one of the important documents to be submitted to DGFT as a proof of export made.<strong>\u00a0 \u00a0<\/strong><\/li>\n<\/ol>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"4_Contents_and_issue_procedure\"><\/span><span style=\"color: #ff6600;\"><strong>4. Contents and issue procedure\u00a0<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">FIRC normally contains the following details:<\/p>\n<ul style=\"text-align: justify;\">\n<li>Name of the beneficiary<\/li>\n<li>Whether the amount is paid by cash or by crediting the beneficiary\u2019s a\/c<\/li>\n<li>Name and address of the remitted<\/li>\n<li>Name and address of the remitting bank<\/li>\n<li>DD\/TT No\/Cheque No<\/li>\n<li>Foreign Direct Investment\u00a0amount in Foreign currency<\/li>\n<li>Equivalent rupee amount (in figures as well as words)<\/li>\n<li>In favour of whom the amount has come<\/li>\n<li>Exchange rate applied<\/li>\n<li>Purpose of the remittance as stated by beneficiary<\/li>\n<\/ul>\n<p style=\"text-align: justify;\">It is signed by the Authorized signatory of the AD bank and countersigned by one more person.<\/p>\n<p style=\"text-align: justify;\">As a procedure, this Certificate is issued to the address of the account holder, normally within a period of 15 days from the date of credit of funds to beneficiary\u2019s account.<\/p>\n<p style=\"text-align: justify;\">FIRC must be kept in safe custody since issue of duplicate involves certain complicated procedure which is time-consuming.<\/p>\n<p style=\"text-align: justify;\">Generally there is confusion about which bank should issue FIRC in case the inward remittance has come into the beneficiary\u2019s account through more than one bank.<\/p>\n<p style=\"text-align: justify;\">In our practical experience and as per clarifications received from RBI as well as provisions under FEMA, the first bank that receives the inward remittance in convertible foreign exchange must issue the FIRC since it would have the details of the overseas remitting bank.<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"5_Conclusion\"><\/span><span style=\"color: #ff6600;\"><strong>5. Conclusion<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">As explained above, FIRC assumes great importance in respect of remittances received from outside India.\u00a0 Therefore, it is critical that beneficiaries follow up with the banks and obtain the FIRC immediately after credit of inward remittance.<\/p>\n<p style=\"text-align: justify;\">Particular attention needs to be paid to \u201cpurpose of Foreign Direct Investment\u201d because any wrong mention of this has serious implications in terms of remittance, usage and accounting of the same.<\/p>\n<p style=\"text-align: justify;\">The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional\u00a0endeavors. For query or help, contact:\u00a0<a href=\"mailto:singh@carajput.com\">singh@carajput.com<\/a>\u00a0or call at 9555555480<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Advantage of Foreign Inward Remittance Certification (FIRC) FOREIGN INWARD REMITTANCE CERTIFICATE (FIRC) 1. Introduction \u00a0Foreign Inward Remittance Certificate (FIRC) is a document that provides proof of inward remittance to India. Such remittance could be either on account of Foreign Direct Investment (FDI) or towards export receivables or towards sale of securities by resident to a &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[208,43],"tags":[3221,3219,3220,3218,3217],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/433"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=433"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/433\/revisions"}],"predecessor-version":[{"id":1777,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/433\/revisions\/1777"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=433"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=433"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=433"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}