Section 45 FEMA Act 1999 - Removal of Difficulties

Section 45 of the Foreign Exchange Management Act, 1999 gave the Central Government a limited power to remove practical difficulties in implementing FEMA, subject to statutory safeguards.

Updated: 27 September 2026

What does Section 45 of FEMA mean?

A "removal of difficulties" provision is a transitional legislative mechanism. Section 45 allowed the Central Government to issue an order when a difficulty arose in giving effect to FEMA, but only if the measure was not inconsistent with the Act itself. The provision therefore did not authorize the Government to amend FEMA through an executive order or to override its substantive requirements.

Text of Section 45 - Removal of difficulties

45. Removal of difficulties.

(1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order, do anything not inconsistent with the provisions of this Act for the purpose of removing the difficulty.

Proviso: No such order may be made after the expiry of two years from the commencement of the Act.

(2) Every order made under this section must be laid, as soon as may be after it is made, before each House of Parliament.

Source: Foreign Exchange Management Act, 1999 - India Code.

Key legal requirements under Section 45

1. A difficulty must arise in giving effect to FEMA

The power is linked to an implementation difficulty. It is not a general rule-making power. FEMA separately provides rule-making powers to the Central Government under Section 46 and regulation-making powers to the Reserve Bank of India under Section 47.

2. The order cannot be inconsistent with FEMA

Any action under Section 45 had to remain within the framework of the Act. The phrase "not inconsistent with the provisions of this Act" operates as an express statutory limitation on the removal-of-difficulties power.

3. The power was available only for two years

FEMA came into force on 1 June 2000. Section 45 itself prohibited making a removal-of-difficulties order after two years from commencement. Accordingly, this was a transitional power and is not an ongoing source of authority for issuing new Section 45 orders today.

4. Orders had to be laid before Parliament

Section 45(2) requires every order made under the section to be placed before each House of Parliament as soon as may be after it is made. This provides legislative oversight of the exercise of the transitional power.

Practical point: Section 45 should be distinguished from Sections 46 and 47. Section 46 concerns rules made by the Central Government, while Section 47 concerns regulations made by the Reserve Bank. Section 45 was a narrower and time-limited mechanism for implementation difficulties.

Related FEMA provisions

For the surrounding statutory scheme, see Section 44 - Bar of legal proceedings, Section 46 - Power to make rules, Section 47 - Power to make regulations, and Section 48 - Rules and regulations to be laid before Parliament.

Official reference

The current statutory text of the Foreign Exchange Management Act, 1999 can be checked on India Code. FEMA administration and regulatory material are also available from the Reserve Bank of India.