Decoding FEMA Residency:Why The 182 Day Requirement Cannot Be Read In Isolation

Introduction

The determination of whether a person qualifies as a “person resident in India” under the Foreign Exchange Management Act, 1999 (“FEMA”) is fundamental to it’s regulatory framework. Residential status determines whether a person is governed by the regulatory regime applicable to residents or by the restrictions applicable to persons resident outside India in relation to foreign investment, acquisition of immovable property, capital account transactions, and the establishment of a place of business in India.

In its judgment dated 9 June 2026 in¹ Directorate of Enforcement v. Joy of India & Ors., the Karnataka High Court (“High Court”) examined the scope of Section 2(v) of FEMA while deciding an appeal filed by the Special Director, Directorate of Enforcement (“Directorate”) against an order of the Appellate Tribunal( ² SAFEMA, FEMA, ³ PMLA, ⁴ NDPS and ⁵ PBPT Act) (“Tribunal”)  in favour of Joy of India, Mr. Kwan Oak Shu and Mrs. Mijeung Bang (“respondents”). Upholding