Section 9 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 9 lists six cases in which sections 4 and 8 do not apply. Section 4 restricts a resident from holding foreign exchange, foreign security and property abroad, and section 8 requires a resident to realise and repatriate foreign exchange. Section 9 is the Act's own relief valve: it lets a person keep certain foreign exchange, up to limits the Reserve Bank specifies, without breaching either section. The Act prints no limit.
Sections 4 and 8 do not apply to six listed cases: (a) foreign currency or coins in possession up to a Reserve Bank limit; (b) a foreign currency account held or operated by a person or class of persons, with a limit the Reserve Bank may specify; (c) foreign exchange acquired or received before the 8th day of July, 1947, held abroad under permission; (d) gifted or inherited foreign exchange traceable to clause (c), up to a limit; (e) foreign exchange from employment, business and similar means, up to a limit; and (f) other receipts the Reserve Bank specifies. The exemption is from sections 4 and 8 only.
About this article
This article is based on the consolidated text of the Act consulted (amendments shown up to Act 50 of 2019). Later amendments should be checked. Section 9 carries no amending footnote in the copy consulted. For an individual or business with foreign currency holdings, our FEMA advisory team can help check which limits apply.
What section 9 does and does not exempt
Section 9: "The provisions of sections 4 and 8 shall not apply to the following, namely:—". Two things are important.
- Only sections 4 and 8 are switched off. Section 3 (the prohibition on dealing in foreign exchange and on payments to non-residents) is not mentioned. The exemption therefore does not by itself permit a transaction that section 3 prohibits.
- The exemptions are limited by the Reserve Bank. Most clauses are tied to "such limit as the Reserve Bank may specify", and "specify" means to specify by regulations under section 2(zd). The matching hooks are in section 47(2).
For the two sections that are switched off, see our articles on section 4 and section 8.
The six clauses
| Clause | Case exempted | Limit or condition in the Act | Hook in section 47(2) |
|---|---|---|---|
| (a) | Possession of foreign currency or foreign coins by any person | Up to such limit as the Reserve Bank may specify | 47(2)(d) |
| (b) | Foreign currency account held or operated by such person or class of persons | The limit up to which the Reserve Bank may specify | 47(2)(e) (class of persons and limit) |
| (c) | Foreign exchange acquired or received before the 8th day of July, 1947, or income arising or accruing on it, held outside India by any person | Held in pursuance of a general or special permission granted by the Reserve Bank | None specific |
| (d) | Foreign exchange held by a person resident in India, acquired by gift or inheritance from a person referred to in clause (c), including income | Up to such limit as the Reserve Bank may specify | 47(2)(f) |
| (e) | Foreign exchange acquired from employment, business, trade, vocation, services, honorarium, gifts, inheritance or any other legitimate means | Up to such limit as the Reserve Bank may specify | 47(2)(g) |
| (f) | Such other receipts in foreign exchange as the Reserve Bank may specify | As the Reserve Bank may specify | 47(2)(h) (any other matter) |
Clause (a): foreign currency and coins in hand
Possession of foreign currency or foreign coins by any person is exempt up to the limit the Reserve Bank may specify. The words "any person" mean the clause is not confined to residents. The limit is for the regulations under section 47(2)(d); the Act prints none.
Clause (b): foreign currency accounts
A foreign currency account held or operated by "such person or class of persons", and the limit up to which the Reserve Bank may specify, is exempt. Printing point: the clause is printed as "foreign currency account held or operated by such person or class of persons and the limit up to which the Reserve Bank may specify", with no verb after "limit", and the words "such person" refer back to no earlier person in the clause. The sense is that the Reserve Bank specifies the class of persons and the limit; section 47(2)(e) says so. The Foreign Exchange Management (Foreign currency accounts by a person resident in India) Regulations, 2015, as amended from time to time, are made under section 9 and section 47(2)(e); this article only names them. For account types of non-residents, see our guide on NRI accounts.
Clause (c): holdings from before 8 July 1947
Foreign exchange acquired or received before the 8th day of July, 1947, or any income arising or accruing on it, which is held outside India by any person in pursuance of a general or special permission granted by the Reserve Bank. The date is the only date in the clause. The condition is the permission: the exemption covers holdings held under the Reserve Bank's general or special permission, not holdings held without it.
Clause (d): gifts and inheritance from a clause (c) holder
Foreign exchange held by a person resident in India, up to the limit the Reserve Bank may specify, if it was acquired by way of gift or inheritance from a person referred to in clause (c), including any income arising from it. The clause links back to clause (c); it does not cover every gift or inheritance, only those from a person referred to in clause (c).
Clause (e): earnings and other legitimate means
Foreign exchange acquired from employment, business, trade, vocation, services, honorarium, gifts, inheritance or any other legitimate means, up to the limit the Reserve Bank may specify. This is the widest clause and the one most readers meet in practice. Because the list ends with "any other legitimate means", it is not closed. The limit is for regulations under section 47(2)(g).
Clause (f): other receipts
Such other receipts in foreign exchange as the Reserve Bank may specify. The Reserve Bank can add categories by regulation; the Act does not name any. Section 47(2)(h) covers "any other matter which is required to be, or may be, specified".
Example. Tanvi, a resident in India, comes back from a trip with some foreign currency notes. Clause (a) exempts possession of foreign currency or coins up to the limit the Reserve Bank specifies, so sections 4 and 8 do not apply to that amount. Whether her holding is within the limit is a matter for the regulations, not the Act. If she holds more than the limit, the exemption in clause (a) does not cover the excess, and she should read the regulations for the position.
Section 9 and the other provisions
- Section 6(4) separately lets a resident keep assets from a period of non-residence. Our article on section 6(4) to (6) explains it.
- Section 13 deals with contravention; a holding that is outside section 9 may be a contravention of section 4 or 8. The consequences are explained in our guide on contravention and penalties under section 13.
What the Act does not say
- It does not print any limit for clauses (a), (b), (d) or (e).
- It does not list the classes of persons for clause (b).
- It does not say how a holder proves that foreign exchange falls within clauses (c) to (e).
- It does not say what happens to the excess over a limit; that depends on the regulations and directions.
Need help with foreign currency holdings?
If you hold foreign currency, run a foreign currency account or have inherited foreign exchange, whether section 9 protects you depends on limits that sit in regulations and change over time. Our FEMA advisory team can read the current regulations against your holding and suggest the next step.
Key takeaways
- Section 9 switches off sections 4 and 8 for six listed cases; it does not switch off section 3.
- The limits are specified by the Reserve Bank by regulation; hooks are section 47(2)(d), (e), (f), (g) and (h).
- Clause (c) depends on a holding before the 8th day of July, 1947 under the Reserve Bank's permission.
- Clause (e) is the widest, covering earnings, gifts, inheritance and other legitimate means up to a limit.
- The Act prints no limits; check the regulations as in force.
Read next
- Section 8: realisation and repatriation of foreign exchange
- Section 4: holding foreign exchange, foreign security and property outside India
- Section 47 and 48: Reserve Bank regulations and laying before Parliament
- LRS: Liberalised Remittance Scheme Complete Guide
Disclaimer: Based on a consolidated text of the Foreign Exchange Management Act, 1999 showing amendments up to Act 50 of 2019, as consulted on 2 October 2026. Limits, forms, timelines and procedures are set by rules, regulations and Reserve Bank directions made under the Act; they change from time to time and are not covered here. Later amendments should be checked. This article is general information, not legal advice; check the official text before acting.