FLA Return under FEMA : four important points
July 3, 2017 by Anupama
FLA (Foreign Liabilities and Asset) Return under FEMA (Foreign Exchange and Management Act, 1999) is Annual Return required to be submitted by all the India resident companies, Partnership firms, Branches or Trustees which have received FDI and/ or made overseas investment in any of the previous year(s), including current year.
Four important points that one should know about FLA Returns:
- Due Date:- FLA is required to be submitted by July 15 every year. In case FLA filed on the basis of provisional accounts, revised FLA is to be filed based on audited accounts before September end.
- Non Compliance:- Non-filing of the return before due date will be treated as a violation of FEMA and penalty clause may be invoked for violation of FEMA. The penalty as prescribed under the FEMA is “THRICE” the sum involved in contravention or Rs. 2 lakh if the offence is non-quantifiable and if the contravention is continuing every day, then Rs. Five Thousand for every day after the first day during which the contravention continues.
- Compounding for delay in filing:- The powers to compound the contraventions have been delegated to all Regional Offices of RBI (except Kochi and Panaji) without any limit on the amount of contravention.
- Where Indian company does not have any outstanding investment in respect of inward and outward FDI as on end-March of reporting year
- If a company has received only share application money and does not have any foreign direct investment or overseas direct investment outstanding as on end-March of the reporting year
- Companies which have issued the shares to non-resident only on Non-repatriable basis are not required to submit the FLA Return.
Procedure of Filing:-
- The FLA Return has to be submitted in excel based format, which has inbuilt checks and validations, any other attachment should not be forwarded along with the FLA return.
- Company’s financial details along with other relevant details needs to be filled in the return based on the audited financial accounts.
- After filling in the requisite details, the Company can file the FLA Return by e-mailing the same to the RBI at [email protected] from an official E-mail address of any authorized person.
- On submission of the FLA return, an acknowledgement will be forwarded to the E-mail address of the authorised person
- The latest format of FLA Return is available on RBI’s web site at the following link: https://www.rbi.org.in/Scripts/BS_ViewFemaForms.aspx
- Any query regarding filling of FLA return should be sent to email [email protected]. You may also contact RBI person handling FLA return.
Note:- Partnership firms, Branches or Trustees which are having FDI as on end of the reporting year, then the same are also required to file excel based FLA Return. These persons should send a request mail to get a dummy CIN number which will enable them to file the Excel based FLA Return. If any entity has already got the dummy CIN number from the previous year, they should use the same CIN number in the subsequent years also.