Furnishing of guarantees by persons who have availed of T.R. benefit and seek to make short visits abroad within a period of one year of stay in India - Reference from employees of foreign firms investing in India or operating an office in India - Customs - F.No. 497/35/88-Cus. VI

Furnishing of guarantees by persons who have availed of T.R. benefit and seek to make short visits abroad within a period of one year of stay in India - Reference from employees of foreign firms investing in India or operating an office in India F.No. 497/35/88-Cus. VI Dated 19-9-1988 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Furnishing of guarantees by persons who have availed of T.R. benefit and seek to make short visits abroad within a period of one year of stay in India - Reference from employees of foreign firms investing in India or operating an office in India . Attention is invited to the above-mentioned subject. A number of foreign firms investing in India have represented that their employees posted to India, who avail themselves of the Transfer of Residence benefit suffer much inconvenience when they have to pay short visits abroad, mainly to their home country, within the first year of their residence in India as they are required to give a bank guarantee for the amount of the duty foregone in the grant of T.R. concessions. The firms in which these persons are employed have been permitted by the Reserve Bank of India either to invest in India or to open offices here although there could be cases where they are employed with Indian firms as foreign technicians posted in India under Technical Collaboration Agreements. The representation has been examined in the Ministry. It is felt that a broad view could safely be taken in case of such foreigners as are employed with reputed and established firms functioning with RBI permits. When such persons desire to go out of India on short visits after availing themselves of the T.R. benefits in the first year of their residence in India, it appears that there would be no harm in allowing them to go out against a plain paper guarantee from the exploying firm covering them for the amount of the duty concession extended to them under the T.R. Rules. The guarantee from a bank in the case of such employees does not appear to be quite necessary as the employing firm, being well established and of repute, could be expected to redeem its word to pay the duty on behalf of the employee if called upon to do so. The guarantee from the employing firm need not necessarily be taken each time the employee (or a member of his family) goes out of the country. A 'standing' guarantee from the firm could be accepted. The Customs House may keep a watch on the way this procedural relaxation works and send the Board a report of six monthly intervals. Any instance in which a guarantee given by an established firm in favour of a foreign employee has not been promptly honoured when invoked should be brought to the notice of the Board by the Collector without delay.