NRIs: TDS compliance for share buybacks

As a resident Indian promoter of a private limited company, I'm buying back shares from a non-resident individual who helped secure export orders. Does this payment fall under the LRS, and what TCS/TDS applies?

- Harshal Bhuta

-Name withheld on request

Under the foreign exchange regulations, an NRI is permitted to invest in equity shares of an Indian manufacturing firm and sell the shares to an Indian resident. The TCS provisions for an individual are applicable on transactions where the payment in forex by the individual is covered under LRS. Since the payment made by Indian resident to purchase an Indian company's shares from a non-resident individual does not fall under LRS, TCS provisions are not applicable in this case.