FEMA Valuation Report

[Aditi Jain]

Hi Everyone,

Can someone confirm in case of FDI this statement from master direction- do we need valuation report if we are only offering under rights issue but not allotting shares to NRI: 

"Indian company may issue equity instruments under Section 62(1) (a) (iii) of Companies Act, to a person resident outside India (other than an OCB). Such issue shall be subject to the pricing guidelines prescribed under Rule 21 of NDI Rules."

Regards,

Aditi Jain

[KD Advisors]

Dear Aditi,

You may contact Mr Dheerendra (IBBI Registered Valuer) and an FDI Expert, he may be able to guide you on your specific requirement. we take valuation reports from him & he responds promptly. I think he will have answer to your query.

CA Dheerendra - ibbi.va...@gmail.com / 9784145413 

Regards,

CS Khushbu

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Thanks & Regards- 

CS Khushbu Shekhawat

KD Advisors

+91 7791885794  

"If you think compliance is expensive try non-compliance"

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[Aditi Jain]

Dear Khushbu,

For now I have got my answer but thanks for providing the reference, I'll contact him if need be.

Regards,

Aditi Jain

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[Nishant Jain]

Hello Aditi ma'am

I have same query in my case we want to renounce share in favour of NRI who is not shareholder can share your thoughts on it.

Nishant jain

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[Aditi Jain]

Hi Nishant,

We had a same case couple of years back, bank did not approve FCGPR stating that this renunciation is not allowed and they finally allowed the form after an year that too on non-repatriation basis (we had to submit a declaration that funds won't be repatriated for that particular renouncee). 

So, I would suggest, you discuss this with your AD bank first before executing the transaction and take a confirmation on this. 

Regards,

Aditi Jain

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[Nishant Jain]

Okay thanks ma'am

As per my understanding rule has been changed this transaction will consider as domestic if made on non repatriable basis 

I am just confused whether we should take valuation report or not 

Nishant jain

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[Aditi Jain]

If you are allotting shares to non resident whether directly or through renunciation, NDI Rules will be applicable requiring valuation report.

Regards,

Aditi Jain

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[Nishant Jain]

Okay thank you so much for the help

Nishant jain

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