American School under scanner for violation of visa, tax laws

The American Embassy School handout "notes that India has placed restrictions on the number of tax-free visas available to school employees".

"So, if you are a teaching couple," the handout says, "we usually have the male spouse apply for the 'employment' visa and the female spouse be noted as 'housewife' on the visa application," the NYT said.

India's external affairs ministry spokesperson Syed Akbaruddin said: "We are aware of these reports. These are serious issues relating to visa and tax matters. We will examine them very carefully."

The Khobragade incident led to a nasty stand-off between the US and India.

However, after she returned to India last week both sides have attempted to return to business as usual.

On Tuesday, US Deputy Secretary of State William Burns hosted a "productive" lunch meeting with Indian Ambassador S. Jaishankar and both sides affirmed the importance of the US-India strategic partnership.

The fact that spouses of some American diplomats were working as teachers in the school was well known. It had been going on for many years as part of the "wink and nod" agreement between the two sides.

In the same manner, Khobragade was allowed to take her domestic help Sangeeta Richard along with her by agreeing to pay the US equivalent salary to her, which Indians cannot afford, said a source.

The US is keen to put aside the Khobragade incident and move ahead with its bilateral ties with India - built steadily over the years, said a source, adding that the Burns-Jaishankar meeting was a firm statement of its intent.