TaxTMI 
TaxTMI 
TaxTMI 
Foreign Exchange Management Act, 1999 (FEMA) Foreign Exchange (Compounding Proceedings) Rules, 2000 (the Rules) - Compounding of Contraventions under FEMA, 1999
X X X X Extracts X X X X
X X X X Extracts X X X X
....nding Proceedings) Rules, 2000, effective from June 1, 2000, Reserve Bank is empowered to compound contraventions relating to rule 7, 8 and 9 of and the third schedule to the Foreign Exchange Management (Current Account Transactions) (FEMCAT) Rules, 2000. With a view to providing comfort to individuals and corporate community by minimizing transaction costs and the same time taking a serious view of wilful, malafide and fraudulent transactions, the Reserve Bank was, vide GSR 609 (E) dated September 13, 2004 empowered to compound all the contraventions of Foreign Exchange Management Act, 1999 (FEMA) except section 3(a) of FEMA. 3. To ensure more transparency and greater disclosure, it has now been decided as hereunder: I. Public disclosure....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ay bring the contents of this circular to the notice of their constituents and customers concerned. 5. The directions contained in this circular have been issued under section 10 (4) and 11 (1) of the Foreign Exchange Management Act, 1999 (42 of 1999). Yours faithfully, (Shekhar Bhatnagar) Chief General Manager-in-Charge Annex Guidance Note on computation of the amount imposed under the Foreign Exchange (Compounding Proceedings) Rules 2000 Ref : A.P. (DIR Series) Circular No. dated May 26, 2016 I. Computation Matrix Type of contravention Existing Formula 1] Reporting Contraventions A) FEMA 20 Para 9(1)(A), 9(1)(B), part B of FC(GPR), FCTRS (Reg. 10) and taking on record FCTRS (Reg. 4) B) FEMA 3 Non submiss....
X X X X Extracts X X X X
X X X X Extracts X X X X
....all be deemed to be 10% of the cost of project). 4] All other contraventions except Corporate Guarantees Rs.50000/- + given percentage: 1st year : 0.50% 1-2 years : 0.55% 2-3 years : 0.60% 3-4 years : 0.65% 4-5 years : 0.70% > 5 years : 0.75% 5] Issue of Corporate Guarantees without UIN/ without permission wherever required /open ended guarantees or any other contravention related to issue of Corporate Guarantees. Rs.500000/- + given percentage: 1st year : 0.050% 1-2 years : 0.055% 2-3 years : 0.060% 3-4 years : 0.065% 4-5 years : 0.070% >5 years : 0.075% In case the contravention includes issue of guarantees for raising loans which are invested back into India, the amount imposed may be trebled. II. T....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ontravention, the amount calculated as above may be enhanced by 50%. III. For calculating amount in respect of reporting contraventions under para I.1 above, the period of contravention may be considered proportionately {(approx. rounded off to next higher month / 12) X amount for 1 year}. The total no. of days does not exclude Sundays/holidays. IV. Illustrations in respect of few sample cases are appended. ============= Document 1 Sheet: Annex X1 Illustrations for calculating the amount to be imposed for various contraventions in terms of guidance note Illustration I - Contravention of Para 9(1)(A) of Schedule 1 to Notification No.FEMA20/2000-RB Date of receipt Amount (Rs.) Date of Reporting to RBI Delay Period of cont....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ys 5.83 Rs.1000/year 5830 4 18.07.2006 497000 19.08.2006 2 days 0.08 Rs.1000/year 80 5 14.09.2006 605320 23.10.2006 10 days 0.08 Rs.1000/year 80 6 25.12.2006 688380 03.02.2007 9 days 0.08 Rs.1000/year 80 7 26.03.2007 501130 04.04.2007 - 0 0 8 14.07.2007 477860 31.08.2007 19 days 0.08 Rs.1000/year 80 9 25.09.2009 788870 21.02.2012 2 years 3 months 27 days 4.33 Rs.1000/year 4330 10 26.11.2009 235720 21.02.2012 2 years 1 month 26 days 4.17 Rs.1000/year 4170 11 08.03.2010 380710 21.02.2012 1 year 10 months 13 days 3.92 Rs.1000/year 3920 12 23.05.2012 78030 21.02.2013 7 months 29 days 0.67 Rs.1000/year 670 5336470 Variable amount 25830 Fixed Amount 10000 Total Imposed 35830 Illustration III - Contravention of Para 8 of Schedu....