New Delhi, June 3 (IANS) The Reserve Bank of India (RBI) has issued a compounding order under Section 15 of the Foreign Exchange Management Act, 1999 (FEMA), in the case of Jusda India Supply Chain Management Private Limited with a one-time payment of Rs 12,52,984.
This has resulted in the termination of proceedings against the company for compounded contraventions of provisions of FEMA, 1999, according to a statement issued by the Enforcement Directorate (ED) on Wednesday.
The order has been passed by the RBI after issuance of “no objection” by the ED, the statement said.
Section 15 provides a mechanism for individuals or companies to voluntarily admit to a violation of FEMA regulations, pay a penalty, and regularise the contravention without undergoing lengthy litigation or legal proceedings.
In this case, based on the credible information received, investigation was taken up by the ED under the provisions of FEMA.
“After completion of investigation, the ED filed a complaint under Section 6 of FEMA before the Adjudicating Authority pointing out contraventions under the Foreign Exchange Management Act by Jusda India Supply Chain Management Private Limited involving the issuing shares, valued at Rs 18.5 crore, to entities from a country sharing land border with India without obtaining prior government approval,” the statement noted.
The company, later on, filed an application before the RBI for compounding of the contraventions under FEMA as per the provisions of Section 15 of the Act.
On reference from RBI, the ED issued no objection for the compounding in line with the true spirit of the Act.
“Accordingly, the RBI, on the basis of no objection issued by ED, has compounded the said contraventions vide compounding order dated April 8 with a fine of Rs 12, 52,984. This has resulted into termination of adjudication proceedings under the provisions of FEMA against the company with regard to the contravention as well as further litigation,” the statement said.
–IANS
sps/khz
