Module: | Introduction, Scope and Residential Status
Q2: A resident of Bengaluru transfers ₹75,000 via UPI, to a friend's bank account in Kolkata. Both accounts are held in Indian banks, and denominated in Indian Rupees. Why does this transaction NOT fall under the purview of FEMA?
✅ Correct Answer: B
FEMA regulates "foreign exchange" and transactions involving foreign currency or cross-border flows.
A transfer of Indian Rupees (INR) between two resident bank accounts within India is a domestic transaction.
It does not involve foreign currency or assets outside India, so FEMA has no jurisdiction over it.
A transfer of Indian Rupees (INR) between two resident bank accounts within India is a domestic transaction.
It does not involve foreign currency or assets outside India, so FEMA has no jurisdiction over it.