Project Office
Foreign entities awarded a project in India can set up a project offices in India to carry out activities related to that project.
The Project office “represents the interest of foreign entity in executing the project”.
General Permission to establish Project Office in India subject to the following conditions:
- Foreign entities have secured a contract from an Indian company to execute a project in India.
- Projects have secured the necessary regulatory clearances.
- Funded directly by inward remittance from abroad, or the project is supported by a bilateral or multilateral International Financing Agency, or a company or entity in India awarding the contract has been granted Term Loan by a Public Financial Institution or a bank in India for the Project.
Approval of Reserve Bank of India
The applicant is a citizen of or is registered/incorporated in Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong or Macau. The application is for opening a PO in Jammu and Kashmir, North East region and Andaman and Nicobar Islands;
Time Limit for Opening PO
- PO shall be opened within six months from the date of the approval letter.
- The AD Category-1 bank may grant extension of time for a further period of six months for reasons beyond the control of the applicant.
- RBI may give further extension.
Opening of Bank Account by PO
Non–interest bearing foreign currency account can be opened with AD category-1 bank.
Extension of Fund and Non-fund based facilities
AD category-1 bank can extend fund and Non-fund based facilities based on their business prudence, Board approved policy and compliances.
Remittance of Profit
PO is permitted to remit outside India the profit of the project net of applicable Indian taxes.
Register with the Registrar of Companies
PO is required to register with the registrar of companies within 30 days from its establishment of business in India as the provisions given under the Companies Act, 2013.
Annual Activity Certificate
The Annual Activity Certificate (AAC) to be filed to the designated AD category-1 bank and Director General of Income Tax (International Taxation).
AAC Shall be filed within six months from the closure of the Financial Year.
Services offered by us
K2Y India has helped foreign companies in setting up there operations in India. Careful tax planning is required before opening a subsidiary, branch, joint venture, project office or liaison office in India. We can help you in corporate planning and setting up in India. We can help your law firm or company in setting up in India.
Our team understands the multi-cultural and the multi-jurisdictional aspects of international business in this age of globalization.