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The problem is that I have never received payments from countries outside from India.
Is there any legal issues for receiving payments through paypal to my bank account.
Kindly give ur suggestions.
Its always difficult to give out legal advises on a public forum where most, if not all, of the members/visitors have no law background. So its best to approach a lawyer in your area who specializes in foreign currency/trade with these questions.
From your post, it sounds you intend to do business with some companies in UK who will pay you for your service. Depending on how you sign the contract with these companies, you may be required by Indian law to have an Importer-Exporter License. If the amount of money involved is very high, you may also consider registering your company/firm with STPI to claim 100% income tax exemption.