Whether Transfer of funds from NRO (Non Resident Ordinary) account to NRE (Non Resident External) requieea CA Certificate in Form 15CB?

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Whether Transfer of funds from NRO (Non Resident Ordinary) account to NRE (Non Resident External) requieea CA Certificate in Form 15CB?

Reply :

When Non Resident is maintaining both NRE and NRO accounts in Indian bank and during the year, he or she transfers money from his NRO account to his NRE account, one common question which we generally face is “whether 15CB is required or not for such transfer ?”

Many bankers are demanding 15CB even in such cases.

One need to know that above is transfer to self and it is not in the nature of “payment” and/ or “income”.

 Thus, strictly speaking, it is not payment at all but movement of fund to self & so certificate under 15CB is not required under Income Tax Law.

However , it is mostly demanded by Banks and the purpose is to ensure that money which is getting transferred from NRO account to NRE account is tax paid. So in such a case, when a client comes to a Chartered Accountant for certificate.

It is advisable that such Chartered Accountant should ensure source of funds in NRO account and also if money in NRO account is tax compliant or not. Because once the money goes into NRE account, it becomes freely transferable to any bank outside India.

It would be better if CBDT clarify the requirements of form No. 15CB in such cases.

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