Can an NRI be a partner in a firm in India

03-May-2023 (In Corporate Law)
Can a NRI be a normal partnership firm in India. Our account has ben closed by the bank due to the reason that one of our partners in a NRI with Indian Origin
Answers (3)

Answer #1
530 votes
Yes , an NRI be in a normal partnership firm in India via two routes 1. Non repatriation route(money once invested can't be taken back outside India). 2. Non repatriation basis but the NRI has to take permission from RBI. But there are certain conditions applied. 1. Partnership firm should not be related agriculture activity or real estate or immovable property 2. Print media

Answer #2
572 votes
NRI = Non Resident INDIAN => Citizenship remains Indian. Thus the Indian Partnership Act and all other laws for that matter, applies equally vis-a-vis the NRI Partner, as it would apply to any other Indian citizen, otherwise it'd be ultra vires the Article 14 and other articles of the constitution. The Bank's action is thus discriminatory. A properly drafted writ petition would get you required relief.
Answer #3
909 votes
A Non-Resident Indian (NRI) can invest by way of contribution to the capital of a firm or a proprietary concern in India on non-repatriation basis provided;
a) Amount is invested by inward remittance NRE OR NRO account maintained with Authorised banks.
c) The firm or proprietary concern is not engaged in any agricultural / plantation or real estate business (i.e. dealing in
land and immovable property with a view to earning profit or earning income there from) or print media sector.
d) Investments with repatriation benefits NRIs may seek prior permission of Reserve Bank of India for investment in sole
proprietorship concerns / partnership firms with repatriation benefits. The application will be decided in consultation
with the Government of India.
e) Investment by non-residents other than NRIs can file an application and seek prior approval of Reserve Bank of
India, for making investment by way of contribution to the capital of a firm. The application will be decided in
consultation with the Government of India.

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