Legal Solution Provider Company in Delhi

One of the leading puzzles in cross border cash flow is the phenomena of Round Tripping.

Where money from one country flows to some other country and again is reinvested in the primary country from which cash flow originated as a Foreign Direct Investment (FDI).

Tax concession allowed in foreign countries encourages Round Tripping as money flows out from the primary country as an investment in a foreign country and later the same money will be invested back in the primary country.

• Many a time black money is transferred to a second country and is returned by them as FDI which translates the black money into white by the help of FDI.
• Mauritius is the largest source for Round Tripping in India.

Commerce and industry minister Piyush Goyal on Friday said the government will not overlook if audit firms advise e-commerce companies to circumvent laws and engage in multi-brand retail trade in the country.

“We are firm in multi-brand retail trade. One should not find loopholes in law...that will not be possible for us to overlook,

As of today Round Tripping is not illegal however RBI (Reserve Bank of India) and SEBI (Security and Exchange Board of India) are taking the necessary steps to regulate it.

• SEBI regulates Round Tripping in India
• RBI Notification against Round Tripping -

Indian companies or their AD (authorized dealer) Category – I banks are not allowed to issue any direct or indirect guarantee or create any contingent liability or offer any security in any form for such borrowings by their overseas holding/associate/subsidiary/group companies except for the purposes explicitly permitted in the relevant Regulations.

Further, funds raised abroad by overseas holding/associate/subsidiary/group companies of  Indian companies with the support of the Indian companies or their AD Category – I banks as mentioned at (i) above cannot be used in India unless it conforms to the general or specific permission granted under the relevant Regulations.