Question ID :
44429
Annual Performance Report APR for Overseas Subsidiary
A Ltd has Subsidiary outside India in Mauritius whose merger got approved from 1.4.2021, where Merger scheme approval got on 1.8.2022 from NCLT and accordingly Financial of 2021-22 of A Ltd has been made by incorporating such merger. Now, Whether APR of subsidiary under FEMA need to file for the FY 2021-22, where due date also not over or get over.
Please guide where merger schemes are having retrospective effect and compliances that should look into .
Posted by
Pankaj Kumar Sharma
on
Feb 16, 2023
Filed Under
INTERNATIONAL BUSINESS
As per the Foreign Exchange Management Act (FEMA), Indian companies having overseas subsidiaries are required to file an Annual Performance Report (APR) in the prescribed format for each financial year with the Reserve Bank of India (RBI) within six months from the end of the financial year.
In the given scenario, since the merger of A Ltd's subsidiary in Mauritius was approved on 1.8.2022 with retrospective effect from 1.4.2021, it is important to consider the impact of the merger on the APR filing requirement.
If the merger scheme has resulted in the dissolution or closure of the subsidiary, then no APR filing would be required for the financial year 2021-22. However, if the merger scheme has resulted in the continuation of the subsidiary's operations under the merged entity, then the APR filing requirement would continue for the financial year 2021-22.
Posted by
Susil Kumar Gupta on
Mar 14, 2023