FEBRUARY 2019

Interim Budget 2019 Highlights

-CA Srinidhi S

For Farmers:

• New Scheme- namely “Pradhan Mantri KIsan SAmman Nidhi (PM-KISAN)” to extend direct income support at the rate of Rs. 6,000 per year to farmer families, having cultivable land up to 2 hectares is announced.
• Farmers having up to 2 hectares of lands will get Rs 6,000 per year in three equal instalments. The scheme will be effective from December 1, 2018.
• Interest subvention for farm loan takers:
• Farmers affected by natural calamities to get 2% interest subvention and additional 3% interest subvention upon timely repayment.
• 2% interest subvention to farmers who pursue animal husbandry, fisheries jobs through Kisaan credit cards
• Kamdhenu scheme for animal husbandry.

Income Tax reliefs:

Personal Income Tax

• There are no changes in personal income tax rates and slabs.
• Rebate under section 87A is proposed to be increased to INR 12500 from INR 2500 on tax for total income up to INR 5 lakhs for individuals

Instead of giving straight exemption on income up to INR 5,00,000/- finance minister twisted the situation by giving Rebate under section 87A. Thus, if income is more than 5 lakhs, assessee cannot claim rebate under section 87A and assessee will need to pay tax on income above INR 2,50,000/- Explained with below example:

Particulars	Situation I	Situation II
Net Total Income	5,00,000	5,00,100
Computation of Tax
0-250000 @0%	0	0
250001-500000 @5%	12500	12500
500001-500100 @20%	0	20
Rebate u/s 87A	12500	0
Net Tax	0	12520
Add: Cess @ 4%	0	501
Net Tax Liability	0	13201

Note: An individual having a Gross Total Income of Rs 6,50,000 with eligible investments and deductions under Chapter VI A will be able to enjoy a tax-free Income as his Net Taxable Income will be Rs 5,00,000 which is eligible for full rebate under Sec 87A.

• Increase in standard deduction from INR 40,000 to INR 50,000 for Salaried employees
• Prescribed monetary threshold for deduction of tax on interest from bank or Post Office deposits increased from INR 10,000 to INR 40,000

Income from House Property

• Relief for owners of more than one house; second self-occupied house not to be subject to tax on deeming/notional basis; aggregate deduction of interest on home loan for self-occupied properties retained at INR 2,00,000

Capital Gains

• Proportionate exemption on long-term capital gains arising from proceeds of sale of residential house extended to purchase of two residential houses from one house, subject to Amount of capital gain not exceeding INR 2 crore [no monetary threshold continues for investment in one residential house] and it is a One-time opportunity to claim such exemption

Benefits to Construction Sector:

In the Affordable Housing sector, benefits under Section 80-IBA of the IT Act were extended by a year for projects approved till March 2020. This will allow Real Estate developers to deduct 100% of profits derived from development of affordable housing projects. Extension of benefits in the real estate sector will give a boost to construction activity, particularly in affordable housing.

Exemption from levy of notional rent on unsold inventories from one year to two years is an additional boon to the real estate industry which is bogged down with huge unsold inventories. The period would be counted from end of the year in which projects get completed.

From the consumers’ point of view, benefits of rollover in capital gains and exemptions on income tax on rent will boost housing demand, and is also expected to increase investments in a second house.

In the previous issue published in Jan 2019, we understood how the residential status of an Individual is determined under FEMA. Having known that, let’s travel further to understand how does a Non-Resident manage his earnings in India with the bankers. It’s important to have a quick understanding of the definitions of an NRI as per FEMA.

Who is an NRI?

Non-Resident Indian (NRI) is defined in Regulation 2 of FEMA Notification No 5 dated May 3, 2000 as:

A person Resident outside India who is a citizen of India or is a Person of Indian Origin (PIO).

PIO is defined as:

A citizen of any country other than Bangladesh or Pakistan, if

1. he at any time held Indian Passport, or
2. he or either of his parents or any of his grand-parents was a Citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955) or
3. the person is a spouse of an Indian Citizen or a person referred to in sub clause (a) or (b)

NRO (Non-Resident Ordinary Account)

Now, let’s get some basic questions on NRO Account answered:

Questions	Answers
Who can open an NRO Account?	Any Person resident outside India
Why is an NRO account opened?	To put through bona fide transactions in Rupees not involving any violation of FEMA Act, rules and regulations.
Prohibitions from NRO	The operations in the accounts should not result in the account holder making available foreign exchange to any person resident in India against reimbursement in rupees or in any other manner.
When is RBI Approval needed for NRO Account opening?	Opening of accounts by entities of Bangladesh Ownership and by individuals/entities of Pakistan nationality /ownership.
Can a Non-Resident open an maintain an account with Post Office?	Yes, same terms and conditions as applicable to NRO accounts with Banks to be followed.
Types of Accounts that can be maintained as NRO	Current, Savings, Recurring Deposits, Fixed Deposits.
Joint Holding Possible?	Yes, a Non-Resident may hold an NRO account jointly with residents and or non-residents.

PERMISSIBLE CREDITS/DEBITS INTO NRO ACCOUNT

Having understood what is an NRO account, who can open and operate it, let us move on to understand what are the permissible transactions for operations in an NRO Account.

PERMISSIBLE CREDITS

PERMISSIBLE DEBITS

Remittances from outside India through normal banking channels in Freely Convertible Foreign Currency. Freely convertible Foreign Currency physically deposited by the account holder during his temporary visit to India. If such amount exceeds USD 5000 or its equivalent, Currency Declaration Form to be submitted. Rupee funds to be substantiated by Encashment Certificate. Transfers from Rupee Accounts of Non-Resident Banks. Income in India like Rent, Dividends, Pension, Interest, Sale proceeds of Immovable Property in India (acquired or inherited) etc., Rupee gift received from a Resident Individual who is a close relative by way of crossed cheque/ electronic transfer. The gift amount cannot exceed USD 1,25,000 per year as per the Liberalized Remittance Scheme available to Resident Individuals. Loan received from a Resident Individual who is a close relative by way of crossed cheque/ electronic transfer. The Loan amount cannot exceed USD 1,25,000 per year as per the Liberalized Remittance Scheme available to Resident Individuals.

All local payments in Rupees including payment for Investments in India subject to compliance of FEMA regulations as applicable. Remittance outside India of current Income like rent, dividend, pension, interest etc. in India of the account holder after payment of due taxes in India. Remittance up to USD 1 million per financial year (April- March), for all bona fide purposes. Transfer to NRE Account of the NRI within the overall limit of USD 1 million in a financial year subject to payment of tax as applicable.

SPECIFIC PROVISIONS RELATING TO REMITTANCE OF ASSETS

There will be situations where a Foreign national who was Resident in India for employment reasons will leave India on account of his retirement. There will also be situations for a PIO or NRI to Inherit assets in India. In this section, we will understand the limits available for remittance of such assets and the conditions attached to it.

Restrictions in Remittances:

In respect of Immovable Property: Not available to citizens of Pakistan, Bangladesh, Sri Lanka, China, Afghanistan, Iran, Nepal and Bhutan. Prior Permission of RBI is required.

In respect of other financial assets: Not available to citizens of Pakistan, Bangladesh, Nepal and Bhutan.

FOREIGN NATIONALS OF NON-INDIAN ORIGIN ON VISIT TO INDIA:

When should a normal account be changed to NRO and vice versa?

a) From Resident to Non-Resident:

• When person resident in India leaves India (other than Nepal or Bhutan) for employment or business or vocation or for any other purpose indicating his intention to stay outside India for an uncertain period.

b) From Non-Resident to Resident:

• On the return of account holder to India for taking up employment, or for carrying business or vocation or for any other purpose indicating his intention to stay outside India for an uncertain period. (Temporary visits aren’t covered).

Resident Bank account maintained by residents in India- Joint Holder- Liberalization

We all are aware of the extant of emigration that is happening from India, where Indians leave to other country for career opportunities and find their livelihood there. We also witness the presence of elderly parents of many NRI’s living in India. The Government understanding the need and dependency of these elderly people with respect to operation of bank accounts by their children residing abroad, has brought in certain liberalization measures to permit resident Indians to include Non-Resident close relatives as Joint Holders on “Either or Survivor” basis. Let’s get an understanding of the rules and regulations prescribed in connection with such an account:

FOREIGN NATIONAL RESIDENT IN INDIA- ACCOUNT MAINTENANCE:

The Foreign Nationals employed in India holding valid visas are eligible to maintain resident bank accounts. When they leave the country, the accounts have to be closed and amounts have to be repatriated abroad. There might be situations that the Foreign Nationals have to hold the account for some more time to receive their legitimate dues in India. In such a scenario, the account has to be reclassified as NRO account by the Banker till such collection. The Banker would get an undertaking for the list of legitimate dues expected by the Foreign National and ensure only such dues get credited to the Bank Account.

The Repatriation limit will be the same USD 1 million per financial year subject to payment of all taxes as applicable in India and the account should be closed once all the money has been repatriated.

OPERATION OF NRO ACCOUNT BY POWER OF ATTORNEY HOLDER:

There are situations where a Non-Resident Individual would like operate his NRO account through a resident in India. Bankers can allow an NRO account to be operated by Power of Attorney Holder who is a resident in India, but is restricted to:

• a) All local payments including payments for eligible investments should be in compliance with the relevant regulations made by RBI.
• b) remittance outside India of current income in India of the non-resident account holder net of applicable taxes.
• c) The resident power of attorney holder is not permitted:
  • to repatriate outside India funds in the account to anyone other than the non-resident account holder
  • nor to make payment by way of gift to any resident on behalf of non-resident or
  • transfer funds to another NRO account.

CONCLUSION

It’s very important for every individual who is not a resident in India to understand the intricacies of opening and operating an NRO account and also the benefits available to carry out smooth banking operations and manage the funds in India effectively.

PRIVATE PLACEMENT OF SHARES BY A PRIVATE COMPANY

Every Business Expansion demands lot of financial investment by the promoters. The Promoters many a time find it essential to source such additional funding from their close relatives or friends. There are also groups of Venture Capitalists, Angel Investors who invest in promising ideas and technology that a Startup works on. We witness an increase in the number of youngsters who choose to be entrepreneurs with innovative ideas. Since Private Limited Companies by definition and nature are not allowed to go public to meet their funding requirements, a special provision for raising funds from a selected group of persons is made available by Companies Act 2013, the terms and conditions of which is prescribed under Section 42. Such special provisions made available to a Private Limited Company is termed as Private Placement.

This Article focuses on giving the reader an understanding the process involved in raising funds through Private Placement Route.

First, let us understand the definition of Private Placement under the Companies Act 2013:

As per Section 42, of Companies Act 2013(as substituted by the Companies Amendment Act 2017 effective from 7th August 2018) (, “Private placement” means any offer or invitation to subscribe securities to a selected group of persons (referred to as “identified persons” whose number shall not exceed fifty or such other higher number *as may be prescribed, excluding (**Qualified Institutional buyers and employees covered by ESOP Scheme) by a company through issue of Private Placement Offer Letter in a financial year subject to such conditions as may be prescribed.

A company cannot make a public announcement for such Private Placement offers.

*the number of persons to whom offer or invitation to subscribe is prescribed as 200, so a company cannot exceed this number in a financial year (applies to each kind of security offered).

*“Qualified institutional buyer’’ means the qualified institutional buyer as defined in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 as amended from time to time under the Securities and Exchange Board of India Act 1992.

Conditions:

• Every identified person willing to subscribe to the private placement issue shall apply in the private placement and application issued to such person along with subscription money paid either by cheque or demand draft or other banking channel and not by cash.
• The Company shall not utilize the funds raised through private placement unless allotment is made and the return of allotment is filed with the Registrar of Companies.
• No fresh offer or invitation under this section shall be made unless the allotments with respect to any offer or invitation made earlier have been completed or that offer or invitation has been withdrawn or abandoned by the company.
•  Allotment to be completed within 60 days of receipt of money, if unable to do so, the Company should refund the application money within 15 days from the expiry of 60 days. In the event of failure of the Company to pay back the application money with 15 days, interest to be paid at 12% per annum from the expiry of sixtieth day.

Procedure for Issue of Securities through Private Placement

Step 1: Board Meeting for Matter in relation to Pre-activity of PP

• The first step in Issue of Shares through Private Placement is to verify the Articles of Association of the company to give effect to Private Placement. If the AOA does not provide the same, then the company shall alter the AOA. Then the Company shall decide upon the Identified Persons to whom the Private Placement is to be issued.
• The Company shall conduct Board Meeting and pass resolution to meet the following agendas i.e. to alter the Articles of Association, to increase the Authorized Capital if required and to consider and approve the Letter of the Offer and issue a Notice calling for a General Meeting.
• The Company shall open a Separate Bank Account in a Scheduled bank for depositing the Application Money to be received.
• The Board shall finalize the list of the Investors for issuance of new Equity Shares.

DISCLOSURES IN EXPLANATORY STATEMENT ANNEXED TO NOTICE FOR SHAREHOLDER’s APPROVAL:
Particulars of the offer including date of passing of Board Resolution
Kinds of securities offered and the price at which security is being offered
Basis or justification for the price (including premium if any)
Name and address of the valuer who performed valuation
Amount which the company intends to raise by way of such securities
Material terms of raising such securities, proposed time schedule, purposes or objects of offer, contribution made by promoters or directors either as part of offer or separately in furtherance of objects, principal terms of assets charged as securities.

Step 2: Conduct of Extra-Ordinary General Meeting (EGM)

In the Second Step, the Shareholders have to approve the issue by way of Private Placement by way of a special resolution for each of the offers or invitations at the General Meeting called for by the Board for this purpose.

• Offer cum application letter shall be in the Form prescribed PAS – 4 serially numbered and addressed to the person to whom offer is made.
• The Form PAS – 4 & PAS – 5 is to be circulated in the General Meeting.
• Form PAS – 4 shall include the Details of the Offer, Financial Position of the Company, any disclosures of interest of the Directors and Declaration by the Directors.
• Form PAS – 5 shall include the personal details of the persons to whom the Offer Letter is to be circulated.
• A Special Resolution is to be passed in the Extraordinary General Meeting to alter the Articles of Association and for Issuance of Equity Shares on Private Placement Basis.
• An Ordinary Resolution is to be passed for Increase in Authorized Share Capital, if any.

Note: Form PAS – 4 and Form PAS – 5 need not be filed with the Registrar by the company, and is enough if maintained by the Company in its records.

Step 3: Issuance of Offer Letter

The Offer Letter being approved in the General Meeting is to be sent to the Identified Persons to whom the Private Placement is to be done either through post or electronic mode or in person.

Prior to issuing the Offer Letter, the special resolution approving the issuance of securities and/or board resolution for issue of securities has to be filed with the ROC. In this regard, it has also been clarified that private companies (which were earlier exempted from filing of board resolutions) will have to file board resolutions passed for issue of securities.

Step 4: Receipt of Application Money

Application Money received shall be deposited in the Separate Bank Account in a Scheduled Bank. The Share Application Money is to be received only through cheque or demand draft or any other banking channel other than Cash.

The Share Application Money received are not to utilized for any other purpose other than

• For adjustment of allotment of securities; or
• For the repayment of monies by the company to those who subscribed, when unable to allot securities.

Step 5: Board Meeting for Allotment of Securities

The final step in Private Placement of shares of Private Company is the allotment of securities by passing a Board Resolution in a Board Meeting. After allotment, the company is to file an e-form PAS – 3 with the Registrar including the following details:

1. Personal Details
2. Class of security allotted
3. Number of securities held, nominal value and particulars of consideration
4. Date of allotment of security

Time Limit for Allotment

Allotment of Securities is to be completed within 60 days from the date of receipt of Share Application Money. On default of allotment, the company shall repay the Application Money within 15 days. On default of repayment, interest of 12% is to be paid from the expiry of sixtieth day.

A return of allotment to be filed within fifteen days from the date of the allotment in such manner as may be prescribed, including a complete list of all allottees, with their full names, addresses, number of securities allotted and such other relevant information as may be prescribed.

PENALTIES

If a company defaults in filing the return of allotment within the period prescribed under sub-section (8), the company, its promoters and directors shall be liable to a penalty for each default of one thousand rupees for each day during which such default continues but not exceeding twenty-five lakh rupees.

Subject to sub-section (11), if a company makes an offer or accepts monies in contravention of this section, the company, its promoters and directors shall be liable for a penalty which may extend to the amount raised through the private placement or two crore rupees, whichever is lower, and the company shall also refund all monies with interest as specified in sub-section (6) to subscribers within a period of thirty days of the order imposing the penalty.

Sample Resolution Formats

Clause for Alteration of AOA:

“Further issue of shares may be made in any manner whatsoever as the Board may determine including by way of preferential offer or private placement, subject to and in accordance with the Act, Rules and other applicable provisions of law.”

Clause for Approval of allotment of equity shares:

“RESOVED THAT pursuant to the provisions of Section 42 of the Companies Act 2013 read with Rule 14 of Companies (Prospectus and Allotment of Securities) Rules, 2014 and such other provisions (including any statutory modifications or re-enactment thereof) as may be applicable for the time being in force, and subject to the approval of members in general meeting, consent of the board of directors of the Company be and is hereby accorded for offering, issuing and allotting ______- no of equity shares (in words) at a face value of Rs ___ each and that draft letter of offer in Form PAS-4 for issue of such securities and record for Private Placement in PAS-5,a s placed before board, be and are hereby approved.

“RESOLVED further that” Mr./Ms. __________of the Company be and is hereby authorized to sign and circulate the letter of offer in Form PAS-4 along with the application form to _________ (Name of Offeree/ said offerees), whose names is/are recorded in Form PAS-5 i.e. Record of Private Placement Offer

RESOLVED further that” Mr./Ms. __________of the Company be and is hereby authorized to file the necessary forms with the Registrar of Companies and to make necessary entries in the applicable registers including but not restricted to the Register of Members for the aforesaid issue and allotment of equity shares.

In as much as GST is concerned, statutory, rate-related and procedural amendments are decided and announced by the GST Council in its monthly meetings. The GST Council consisting of representatives from the Centre as well as the States was established under Article 279A (4) of the Constitution.

GST Council in its 31st GST Council Meeting held on 22nd December 2018 has approved multiple amendments in GST legislature. Key changes in GST made effective from 1st February 2019 are summarized as below:

Particulars	Amendments	Impact on Business/ Action required
Multiple registration under GST	The concept of ‘business vertical’ has been done away with. Definition of the same omitted from section 2(18) of CGST Act.	Registration can be applied for separately for each place of business in the same state
Modification in term “Supply”	The following clarificatory explanation has been inserted in the definition of 'service' - For the removal of doubts, it is hereby clarified that the expression "services" includes facilitating or arranging transactions in securities. It has been clarified that merely because an activity falls under 'Schedule II (which specifies if an activity is to be treated as goods or service), it does not necessarily qualify as a supply.	This is a clarificatory amendment according to which any service charges, service fees, broking fees, etc., charged in relation to securities would attract GST as it is a consideration for the provision of service. Businesses should re-evaluate the positions adopted by them in respect such supplies which are covered under Schedule II of the Act.
RCM on procurements from unregistered dealers applicable only in notified cases	Section 9(4) mandated that a registered person is liable to pay tax under reverse charge on purchases from an unregistered supplier. This section was under suspension. The provision has now been diluted by providing an enabling power to the government to notify class of registered persons who would be liable to pay tax under reverse charge on procurements of taxable goods or services from unregistered suppliers.	Presently, no class of persons have been notified and accordingly businesses would not be required to pay tax under RCM on procurement from unregistered suppliers. However, businesses should closely monitor the decisions of the GST council in respect with the class of taxpayers to be notified under this section. The amendment may also impact the vendor selection criterion adopted by businesses at the time of implementation of GST.
Credits in relation to motor vehicles liberalized	ITC would be allowed in respect of motor vehicles for transportation of persons having an approved capacity of more than thirteen persons including driver when they are used for purposes as are specified. Furthermore, ITC in respect of services of general insurance, servicing, repairs and maintenance in respect of above motor vehicles should also be available.	Businesses who use vehicles (more than 13 seating capacity) such as buses, etc. for transportation of employees should be eligible for ITC. ITC should now be available in respect of dumpers, work-trucks, fork-lift trucks and other special purpose motor vehicles. The amendment should allow businesses which deploy such vehicles to claim ITC in respect of them.
ITC to be available in respect of blocked credits if facilities provided to employees is mandated under any law	ITC would be available in respect of food and beverages, health services, travel benefits to employees, etc. where the provision of such goods or services is obligatory for an employer to provide to its employees under any law for the time being in force.	This provision would particularly benefit businesses which are required to provide canteen facilities to their employees in accordance with the Factories Act. Businesses can avail ITC benefit in respect of such input services when the same is mandatory to be provided as per regulations.
ITC available to the party billed in respect of services provided directly to a third person	One of the key conditions for availing of ITC by a registered person is that such the person should have received such goods or services. In case of 'bill-to-ship-to' transactions, where the goods would be directly sent to a third person, a deeming fiction has been provided to allow the person in whose name the invoice is raised to avail ITC without actually receiving such goods. Now, a similar deeming fiction has been provided in case of services.	This amendment should allow ITC benefit to a registered person even when the services are provided by the supplier to a third person on the direction of and on account of such registered person.
No interest liability on ITC reversed because of failure to pay consideration to the supplier within 180 days	As per Second Proviso to Section 16(2), where a recipient fails to make payment to the supplier within 180 days from the date of issue of invoice, he should add an amount equal to input tax credit (ITC) availed in respect of such supply to his outward tax liability, along with interest thereon. The requirement to pay such interest has been done away with.	The GST Council has re-visited the provision of levying interest on such outward liability and has deemed it as too onerous and therefore removed the provision. This would result in a lower GST interest cost for businesses.
Sale of goods from Customs bonded warehouse, High sea sales and drop shipments not taxable Schedule III of CGST Act	The following transactions have been inserted in Schedule III of CGST Act, 2017: Supply of goods from customs bonded warehouse to any person before clearance for home consumption Supply of goods by the consignee to any other person, by the endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin outside India but before clearance for home consumption, i.e., high seas sales Sale of imported goods outside India, without such goods entering into India at any stage, i.e., drop shipment	This is in line with the position adopted by the advance ruling authority and the government in the advance ruling and circular. Amendment in the law should bring further clarity for businesses and protect them from any adverse action by the jurisdictional authorities.
Suspension of registration for which application of cancellation is under process	Once a registered person has applied for cancellation of registration, the GST officer may temporarily suspend the registration of the person till the procedural formalities for cancellation of registration subject to certain conditions and limitations are completed.	This measure will reduce the compliance burden on the business (with respect to entities where registration is to be cancelled) during the period when the application for cancellation of registration is under process.
Option to businesses to raise consolidated credit/debit notes	The registered person would be allowed to issue consolidated credit/debit notes in respect of multiple invoices issued in a financial year without linking the same to individual invoices.	The requirement for issuance of invoice wise debit/credit note is removed, and the facility of consolidated credit/debit notes for multiple invoices is to be allowed. This should especially help such businesses where year-end discounts are provided on the basis of the value of transactions undertaken during the year and one to one nexus with invoices is not possible. GST portal needs to be updated to enable this functionality.
Enabling provision to provide facility to amend GST returns	A new section 43A added that requires every registered person who has filed returns under section 39(1) to verify, validate, modify or delete the details of supplies furnished by the suppliers. *yet to be notified	A new section is being introduced in order to enable the new return filing procedure as proposed by the Returns Committee and approved by GST Council.
Important amendments in sections relating to mechanism for utilization of input tax credit.	The following have been inserted through provisos: - SGST credit shall be utilised towards payment of IGST only when the balance of CGST credit is not available for payment of IGST - UTGST credit shall be utilised towards payment of IGST only when the balance of CGST credit is not available for payment of IGST Section 49A inserted to state that CGST credit, SGST credit and UTGST credit shall be used for payment of IGST only after IGST credit has been fully utilized for IGST liability The words ‘eligible duties’ have been retrospectively added to the word CENVAT credit in section 140(1) to specifically restrict the carry forward of KKC. Explanation provided to clarify that ‘eligible duties and taxes’ excludes any cess which is not specified in Explanation 1 and 2 and any cess which is collected as additional duty of customs	The order of utilization of credit would be that first the entire balance of IGST would have to be exhausted against output IGST, CGST and SGST. Only once the IGST is exhausted that one would be able to utilize the credit of CGST and SGST. While prior to the amendment, first intra-head adjustment was done and any balance left post that was adjusted inter-head. The rigid rule of utilization of credit would lead to a situation leading to increased outflow of payment in cash. This will require a detailed impact analysis.
Services to qualify as an export even if consideration is received in Indian rupees, subject to RBI regulations	The criteria for service to qualify as 'export of services' has been relaxed to allow receipt of payment in Indian rupees, provided it is permitted by the Reserve Bank of India (RBI).	The government had already relaxed this condition for exports to Nepal and Bhutan through notification. This has been further strengthened through amending the Act.
Transport services for goods transported outside India to qualify as export	The place of supply in respect of transportation of goods from a place in India to a place outside India by a transporter located in India will be outside India.	This will provide a level playing field to the domestic transport companies in India and will reduce the transportation cost to the businesses with respect to the export of goods.