Corporate Updates – 16-06-2016


Ministry of Finance has issued a circular clarifying that present levy of excise duty on readymade garments and made articles of textiles bearing a brand name or sold under a brand name is not on all readymade garments and made ups, and is restricted only to readymade garments and made up articles of textiles bearing a brand name or sold under a brand name and having retail sale price (RSP) of Rs. 1000 or above. Also such retailer shall not be liable to pay excise duty if the aggregate value of clearances for home consumption by such person is less than Rs. 1.5 crore in a year [provided aggregate value of clearances during previous financial year was less than Rs. 4 crore] Further, to avoid disputes and minimize duty evasion, it has also been provided that affixing a brand name on the product, labeling or relabeling of its containers or repacking from bulk packs to retail packs or the adoption of any other treatment to render the product marketable to the consumer, shall amount to manufacture. The circular also provides the definition of ‘brand name’.


Reserve Bank of India (RBI) has notified Foreign Exchange Management (Foreign currency accounts by a person resident in India) Regulations, 2015. The regulation imposes restriction on holding foreign currency account by a person resident in India. As per the regulations a person resident in India may open and maintain Foreign Currency Account with an authorised dealer in India, to be known as Exchange Earners’ Foreign Currency (EEFC) Account. Further, a Special Economic Zone (SEZ) may open Foreign Currency Account in which funds received by the unit in the Special Economic Zone (SEZ) are to be credited. The regulation also specifies the requirements for startups to maintain Foreign Currency Account.

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