Caselets on NRO NRE

1. What are the main points to be taken care at the time of opening of Non
Resident Accounts ?
Use the prescribed application form for opening the accounts along with an
undertaking from the account holder to inform the Bank on arrival to India on
Permanent basis.
To obtain necessary documentary evidence, to confirm the non resident status.
Whenever NRE accounts are opened for a person before going abroad, the
branch should verify Passport, Visa & Air tickets before opening the account. The
account can be opened with zero balance and account number can be given to
the customer.
If the account is to be opened by an existing NRI, then Application form duly
completed along with the copy of the Pass port, VISA and remittance.

2. Is there any restrictions in repatriating funds from NRO account ?

Ans: Yes. Maximum one USD1 Million for financial year which includes transfer to
NRE account. The customers are expected to give Form 15 CA and 15 CB in both
the cases as per CBDT.(Sec 195 of the IT act 1961) for personal remittances.
Form 15 CA is to be filed by the account holder electronically and form 15 CB is
a certificate by chartered accountant.

3. Who can open / have NRO account ?

1. Any person resident outside India includes foreign tourist who are on short
visit to India
2. Bangladeshi National Individuals are now freely permitted to open NRO
account.
3. Pakistan national Individuals/Entities and Bangladeshi entities require RBI
permission
4. Existing domestic account of a Resident Indian has to be converted into NRO
on change of status of the account holder.
5. Foreign Students Studying in India.(Recent Guidelines)

6. A Foreign Citizen who was employed in India, on superannuation/Completion

of Job, who is leaving India on a permanent basis, can convert his existing
Resident account in to NRO account for receipt of his pending dues.

4 . Is there any restrictions in repatriating the sale proceeds of immovable assets

or financial assets of a Non Resident Indian, outside India ?
Ans: Yes. The remittance facility in respect of sale proceeds of Immovable assets
is not available to citizens of Pakistan, Bangladesh, Nepal, Bhutan, Afghanistan,
Iran, Sri Lanka, & China.
In respect of sale proceeds of other financial assets is not available to citizens of
Pakistan, Bangladesh, Nepal and Bhutan.

5. What are the restrictions when a foreign national is maintaining an NRO

account ?
Ans: Foreign National
circumstances.

can

open/maintain

NRO

account

under

three

1. Foreign Tourist: A Foreign Tourist can open a NRO account during their stay
in India and receive credits into the account for their local expenses in India.
This account can be maintained for a maximum period of 6 months only and at
the time of closure, whatever the funds that is available in the account is to be
repatriated from India. If it is not repatriated, within 6 months from the date of
opening, RBI permission is required for closure and repatriation.
2. Foreign Student studying in India: A foreign student who has secured
admission in India, can open NRO account with the name proof and address
(foreign) proof. The student has to furnish the proof of local address with the
bank within 30 day of opening the account. Till such time a remittance of $1000
can only be credited. Withdrawal for local payments is permitted up to
Rs.50000/- . A Pakistani national needs RBIs approval for opening the a/c.
(RBI Cir.DBOD/AML/BC.No45/14.01.0001/2013-14, Dated 02.09.2013)
3. A Foreigner Employed in India: A foreign citizen, who was employed in
India, can covert his resident account into NRO account, on his leaving India on
permanent basis either on superannuation / resignation or for any other reason.
The necessity to continue the NRO account in India may arise to receive pending
dues from the employer or from any other local resources. In this case he has
declare what is the approximate expected amount he will receive in this account

and likely period of maintaining the account. During this time no other credit,
including inward remittance from abroad should be credited to this account.
6. Mr. Gunasekar, a senior Manager of your Bank who has retired and settled in
Singapore along with his son. He request you to change the existing resident
account in to NRO account with the additional benefit of staff and senior citizen ?
Ans: Additional Interest is not eligible for staff or retired staff for any of the Non
Resident account. Further additional interest for senior citizen is also not
available.

7. Mr. Shanmugam having a Savings Bank account maintains quite a good sum
of term deposits with your branch. Mr. Shanmugam has shifted to USA and
became an NRI. He has sent Rs.10 lakhs from abroad and wants you to open Rs.
5 lakhs as Domestic deposit with his local address and Rs.5.00 lakhs as NRE
deposit with Foreign address. What shall be view of the branch ?
Ans: Rs.5 lakhs can be opened as NRO deposit & Rs. 5 Lac as NRE only.
HHowever we have to inform him that TDS will be collected for the interest
income earned under NRO account.
8. Mrs. Nithya is having a joint account with her spouse Mr. Vijay in your branch
in the style of E or S. Now. Mr. Vijay has become a Non Resident. Mrs. Nithya
wants to continue the account in the same style. What is your reply?
Ans: Mrs. Nithya can continue the account with a non resident husband in the
same style E or S. The non resident can continue to operate the account subject
to the following conditions
1. The account will be only a resident account
2. Cheques, instruments, remittance, cash, card, any other proceeds belonging
to NRI close relative shall not be credited to the account.
3. NRI close relative is permitted to operate the account only on behalf of the
resident account holder for domestic payment and not for creating any beneficial
interest for him self.
4. Where the NRI close relative becomes a joint holder with more than one resident in such
account, such NRI close relative should be the close relative of all the resident bank account
holders.
5. Where due to any eventuality, the non-resident account holder becomes the survivor of
such an account, it shall be categorized as Non-Resident Ordinary Rupee (NRO) account as
per the extant regulations.
6. Onus will be on the non-resident account holder to keep AD bank informed to get the
account categorized as NRO account and all such regulations as applicable to NRO account
shall be applicable.

7. The above joint account holder facility may be extended to all types of resident accounts
including savings bank account.

10. Mr. Ganesh , a supervisor in UAE, whose salary is credited to his NRO
account with your branch, request you for a loan of Rs. 25000/- for his family
function. What decision will you take ?
Ans: A temp. Overdraft of Rs.50000/- can be given to Non resident in his account
which has to be liquidated within two weeks.