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I am working in US as a resident alien. I have few dollars in my bank account in US. If I give some dollars to a friend in need in US and he deposits equivalent amount in Rupees in my Indian bank account, will I be liable to pay tax on the entire Rupees amount in India?

  • Are you a US tax resident? Do you have NRI status? and if so, have you converted your savings accounts in India to NRO accounts? Rupee deposits cannot be put into NRE accounts. – Dilip Sarwate Jul 26 '15 at 18:55
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You friend would only be able to deposit this in NRO account. You may have to explain the source of money. If you declare it as gift, then you would need to pay gift tax.

What you are doing is converting USD to INR outside the normal banking network and this maybe in volition of FEMA [Foreign Exchange Management Act].

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