Agile based development seems to become a favorable model for offshore development. It allows both on and offshore team to work in small iterations minimizing the effect of change in software requirements and at the same time developing regular communication between them. However different factors such as physical distance and lack of communication between on and offshore team becomes a hurdle between them leading to misunderstandings about software requirements. This research work gives an insight about these challenges from the software industry by presenting and discussing the responses of four software companies located in different countries, collected through an online questionnaire. The authors found that lack of communication between on and offshore site is seen as a major challenge for better understanding of software requirements. Shorter iterations at the offshore site require more communication with the onshore site. The language problem seems to exist only when both on and offshore site who are non-English speakers communicate in English. Regular long distance meetings would help in better understanding of software requirements. Previous domain and product knowledge is helpful in better understanding of software requirements. This research work would allow different stakeholders within agile based on/offshore setting to better understand these challenges and deal accordingly with them.