Reserve Bank of India vide RBI/2012-13/502 A.P. (DIR Series) Circular No. 104 dated May 17, 2013 has reviewedthe policy issued vide A.P. (DIR Series) Circular No. 74 dated June 20, 2011 read with A.P. (DIR Series) Circular No. 55 dated December 9, 2011 wherein it was allowed to issue equity shares/ preference shares under the Government route by conversion of import of capital goods, etc. subject to terms and conditions.
Earlier, the condition Para 3(II)(c) states that “The payments should be made directly by the foreign investor to the company. Payments made through third parties citing the absence of a bank account or similar such reasons will not be eligible for issuance of shares towards FDI”. On review, the stated condition has been modified. Accordingly, “The payments should be made by the foreign investor to the company directly or through the bank account opened by the foreign investor as provided under FEMA Regulations”