Amendment of section 6 .
166. In section 6 of the Foreign Exchange Act,-
(A) in sub-section (2),--
(i) for clause (a), the following clause shall be substituted, namely:--
“(a) any class or classes of capital account transactions, involving debt instruments, which are permissible;”;
(ii) after clause (b), the following clause shall be inserted, namely:-
“(c) any conditions which may be placed on such transactions;”;
(iii) for the proviso, the following proviso shall be substituted, namely:--
“Provided that the Reserve Bank or the Central Government shall not impose any restrictions on the drawal of foreign exchange for payment due on account of amortisation of loans or for depreciation of direct investments in the ordinary course of business.”;
(B) after sub-section (2), the following sub-section shall be inserted, namely:-
“(2A) The Central Government may, in consultation with the Reserve Bank, prescribe--
(a) any class or classes of capital account transactions, not involving debt instruments, which are permissible;
(b) the limit up to which foreign exchange shall be admissible for such transactions; and
(c) any conditions which may be placed on such transactions.”;
(C) sub-section (3) shall be omitted;
(D) after sub-section (6), the following sub-section shall be inserted, namely:-
‘(7) For the purposes of this section, the term “debt instruments” shall mean, such instruments as may be determined by the Central Government in consultation with the Reserve Bank.’.
Notes on Clauses:
Clauses 166 and 170 of the Bill seek to amend sections 18, 34, 46 and 47 of the Foreign Exchange and Management Act, 1999. The said amendments are consequential to the Part VII providing for the amendments to the Prevention of Money laundering Act, 2002.
