Shri Urjit Patel
Reserve Bank of India
Central Office Building,
18th Floor, Shahid Bhagat Singh Road,
Mumbai-400 001.

Dear Shri Patel ,

Good wishes.

I Rajesh H Dhruva am a Chartered Accountant advising Overseas Indians in matters related to Foreign Exchange Management Act, 1999 (FEMA) , Indian and International Tax for more than 26 years and am also Chief Executive of

The Press Release and Notification RBI/2016-17/205 dated 31st December 2016 of Reserve Bank of India extends Facility for Indian Citizens who were abroad for Exchange of  Specified Bank Notes (SBNs). I am prompted to draw you attention to certain important miss outs which have created serious hardship for Non Resident Indians who are foreign citizens of Indian origin as mentioned herein :

I.    RULES :

1.  The Press Release as also Notification No. RBI/2016-17/205 DCM (Plg) No.2170 /10.27.00/2016-17 grants facility to exchange SBNs during grace period to INDIAN CITIZENS only .

2.    Indian Citizens are further divided as :
.01  RESIDENT INDIANS who were abroad from 9th November to 30th December and
.02  NON RESIDENT INDIANs (NRIs) who were not in India from 9th November to 30th December.
.03  Whereas Resident Indians are not having any restrictions about the amount of deposits , NRIs are restricted to tender a maximum of Rs. 25,000/- subject to production of Indian Customs certificate of import of SBNs..


1.    Foreign Citizen of Indian Origin i.e. Person of Indian Origin (PIOs) who are also NRIs are not granted the facility and are eliminated in total.

2.  The term NRI as also definition of NRIs (vide Foreign Exchange Management (Deposit) Regulations 2000 vide Schedule 1 clearly regarded Indian citizens as also Foreign citizens of Indian origin as Non Resident Indians..
.02 Even the Foreign Exchange Management (Deposit) Regulations 2016, Notification No. FEMA 5(R)/2016-RB dated 1st April 2016 in Schedule 1 specifically permit Foreign Citizen of Indian Origin to maintain Non Resident External (NRE) accounts at par with NRIs who are Indian citizens.

3.   Foreign Citizens of Indian Origin are also allowed to maintain Non Resident Ordinary (NRO) account as per details of Schedule 3 of Master Direction on Deposits and Accounts.

4.    There are large number of NRIs who have adopted Foreign Citizenship and the entire class of these Foreign citizen NRIs are excluded from this facility which is restricted only to NRIs who are Indian Citizens.

5.    FOR SURE this seems to be a drafting error and not the intention of Reserve Bank of India nor the Government of India.

6.    Moreover whereas Resident Individuals are granted facility to deposit any amount of SBNs, NRIs are restricted to deposit maximum amount of Rs. 25,000/-.

7.    This restriction seems to be based on the assumption of SBNs being carried out of India and brought back in India as a condition is also laid down about certificate of Customs Authorities for import and subsequent deposit of SBNs up to Rs. 25,000/- as FEMA Regulations permit an individual to carry a maximum of Rs. 25,000/- only out of India.

8.   This provision has totally missed NRIs having SBNs at Home in India or in Lockers in India which would have been left in India being legitimate balances out of Bank withdrawals from NRO / NRE accounts.

9.   I may also draw Your kind attention to the fact that till 31st December 2016 Foreign Citizens of Indian Origin could deposit legitimate balances of SBNs in their NRO account at par with Indian Citizen NRIs.
.02  And there were no limits of Rs. 25,000/- as the Reserve Bank of India recognized the fact of NRIs having legitimate unspent balances of SBNs in India.

10.    In contrast, now, only Indian Citizens are allowed to deposit SBNs up to Rs. 25,000/- being imported into India thereby NRIs who were Foreign Citizen of Indian Origin are denied the benefit of depositing their legitimate balances of their SBNs imported into India and
.02    NRIs who are Foreign Citizens as also Indian Citizens are both denied facilities of depositing SBNs which were retained in India but could not be deposited before 31st December only on account of such NRIs not being in India and also relying on Reserve Bank of India's earlier Notification allowing deposit of legitimate balances of SBNs after 31st December 2016 upto to 31st March 2017.


1.    No doubt by virtue of A.P. (DIR Series) Circular No. 24 of 3rd January 2017 extension has been granted to Foreign Citizens to exchange SBNs up to Rs. 5,000/- per week upto 31st January 2017  which will squarely include Foreign Citizens of Indian Origin but as that would not allow import of SBNs by Foreign Citizen NRIs , Reserve Bank of India
should allow up to 30th June 2017 :

.01  Recognise Foreign Citiznens of Indain Origin NRIs at par with Indian Citizen NRIs  as regards deposit of SBNs up to 30th June 2017.

.02  Allow Foreign Citizens of Indian Origin to import SBNs up to Rs. 25,000/- in India for depositing into their NRO account and

.03  Also allow deposit of all the legitimate balances of SBNs retained in India by Indian Citizens as also Foreign Citizens of Indian Origin.

2.  Reserve Bank of India should also accept deposits of SBNs by NRIs as also other permissible individuals at all Offices of Reserve Bank of India.
I am sure my submissions will find your consideration and favour.

Thanking you in anticipation.

Sincerely ,

Chief Executive
Tel. No. : 0091 281 245 3367 (four lines) / 245 9613
Cell : 0091 98240 49944
email ;