Dear Friends,
Greetings from CWS!
I have a query on debt. The query is:
- Can a secured or an unsecured debt be treated as FC money?
- If yes, under what circumstances?
Thanks and regards,
_____________________________________
B V Soma Sastry
Director – Finance and Admin
Centre for World Solidarity
12-13-438, Street No. 1, Tarnaka
Secunderabad 500 017
Andhra Pradesh
Section 2 (h) defines foreign contribution as donation, delivery or transfer made by any foreign source. Under sub-clause (iii) it covers security under the Foreign Contribution. Security is defined in clause (h) of section 2 of the Securities Contract (Regulation) Act 1956. The clause specifies securities to mean shares, scrips, bonds, debentures, debenture stock or other marketable securities of a like nature of any incorporated company or body corporate. It includes any derivatives, rights or interests of these securities, units or any such other instrument, security receipt, Govt securities.
The definition also includes any foreign security covered under clause (o) of section 2 of FEMA 1999. The section again basically covers shares, stocks, bonds, debentures
or any other instrument denominated or expressed in foreign currency.
From the above definition it is clear that any ‘debt instrument’ as defined above even of denominated in Indian currency but donated / transferred by a foreign source would be covered under the definition of Foreign Contribution.
rgds
subhash mittal