Atum It Services India Private Limited

In the matter of M/s. Atum IT Services India Private Limited D No. 1-55-199 Botanical Garden Road, Kondapur Serilingampally Municipality Hyderabad-500084 Telangana (Applicant) In exercise of the powers conferred under Section 15 (1) of Foreign Exchange Management Act, 1999 and the Regulations/ Rules/ Notifications/ Orders made there under, I pass the following Order The applicant has filed the compounding application dated August 01, 2017 for compounding of contraventions of the provisions of the Foreign Exchange Management Act, 1999 (the FEMA) and the regulations issued thereunder. The contraventions sought to be compounded are (i) delay in reporting receipt of foreign inward remittances; (ii) delay in submission of Form FC-GPR to the Reserve Bank after issue of shares towards subscription to equity and (iii) neither the equity instrument were issued nor amount refunded to the person resident outside India in terms of Paragraph 9 (1) (A) and Paragraph 9 (1) (B) and Paragraph 8 respectively

Compounding of contraventions under FEMA 1999 M/s Atum IT Services India Private Limited CA No. HYD 232 of Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000 of Schedule 1 to Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000 notified vide Notification No. FEMA.20/2000-RB dated 3rd May 2000 and as amended from time to time (hereinafter referred to as Notification No. FEMA 20 /2000-RB).

2. The relevant facts of the case are as follows: a) The applicant is a resident company originally incorporated as ERP and ERP India Private Limited Company under the Companies Act, 1956 on 19.12.2010 and later changed its name to Atum IT Services India Private Limited with effect from 10.04.2013 (CIN: U72900TG2010PTC071586). The company is engaged in the business of computer programming, consultancy and related services.

b) The applicant had received foreign inward remittances from four foreign investors towards advance for subscription to equity shares as indicated below.

Sl Name of Remitter Total Amount Date of Date of No (INR) Receipt Reporting 1 Vikram Veerapaneni 31738 24.01.2011 02.04.2011 2 Srinivas R Yalla 44659 24.01.2011 02.04.2011 3 ERP & ERP Corp, 1825526 03.10.2012 12.12.2013 USA 4 ERP & ERP Corp, 1096188 02.11.2012 12.12.2013 USA 5 ERP & ERP Corp, 1071000 02.11.2012 12.12.2013 USA 6 ERP & ERP Corp, 2479500 29.11.2012 12.12.2013 USA 7 ERP & ERP Corp, 880000 06.12.2012 12.12.2013

Compounding of contraventions under FEMA 1999 M/s Atum IT Services India Private Limited CA No. HYD 232 USA 8 ERP & ERP Corp, 1367000 31.12.2012 12.12.2013 USA 9 ERP & ERP Corp, 2157347 30.10.2012 12.12.2013 USA 10 ERP & ERP Corp, 1491044 03.01.2013 12.12.2013 USA 11 ERP & ERP Corp, 2170130 31.01.2013 12.12.2013 USA 12 ERP & ERP Corp, 572878 08.02.2013 12.12.2013 USA 13 ERP & ERP Corp, 1331983 04.03.2013 12.12.2013 USA 14 Neelima Pedarla 84574 03.07.2015 22.07.2015 Total 16603567

The applicant received remittances from overseas investor and reported remittances amounting to ` 1,66,03,567 /- to the Regional Office of Reserve Bank of India during the period from 24.01.2011 to 03.07.2015 as indicated above out of which remittances amounting to ` 1,65,18,993 /- were reported with delays ranging from 1 month 7 days to 1 year 1 month 9 days approximately beyond the prescribed period of 30 days. Whereas in terms of Paragraph 9 (1) (A) of Schedule 1 to Notification No. FEMA 20/2000-RB, an Indian company issuing shares or convertible debentures in accordance with these Regulations should report to the Reserve Bank of India as per the prescribed procedure not later than 30 days from the date of receipt of the amount of consideration. c) The company allotted shares and filed form FC-GPRs as indicated below:

Sl Name of investor Date of Number of Amount for Date of No allotment shares/CCPS which shares reporting of shares allotted allotted (INR) 1 Srinivas R Yalla 03.03.2011 4000 Eq 40000 04.04.2011

Compounding of contraventions under FEMA 1999 M/s Atum IT Services India Private Limited CA No. HYD 232 2 Vikram 3000 Eq 30000 Veerapaneni 3 ERP & ERP Corp 01.12.2014 1080 CCDS 16442596 31.12.2014

4 Neelima Pedarla 09.07.2015 845 Eq 84500 13.08.2015

Total 16597096

The applicant filed form FCGPRs for issue of shares amounting to `1,65,97,096/- out of which shares amounting to ` 1,54,500/-as indicated above were reported with delays ranging from 2 days to 5 days approximately beyond the stipulated period of 30 days. Whereas in terms of Paragraph 9(1) (B) of schedule 1 to Notification no. FEMA 20/2000-RB, an Indian company issuing shares in accordance with these Regulations has to submit to Reserve Bank a report in form FCGPR along with documents prescribed therein within 30 days from the date of issue of shares to person resident outside India.

e. The company has delayed in allotment of shares beyond the stipulated period of 180 days in respect of remittances aggregating to ` 1,64,42,596 /-and the delay ranges from 1 year 2 months 27 days to 1 year 7 months 28 days approximately.

Sl Name of Remitter Total Amount Date of Date of No (INR) Receipt allotment 1 ERP & ERP Corp, 1825526 03.10.2012 01.12.2014 USA 2 ERP & ERP Corp, 1096188 02.11.2012 01.12.2014 USA 3 ERP & ERP Corp, 1071000 02.11.2012 01.12.2014

Compounding of contraventions under FEMA 1999 M/s Atum IT Services India Private Limited CA No. HYD 232 USA 4 ERP & ERP Corp, 2479500 29.11.2012 01.12.2014 USA 5 ERP & ERP Corp, 880000 06.12.2012 01.12.2014 USA 6 ERP & ERP Corp, 1367000 31.12.2012 01.12.2014 USA 7 ERP & ERP Corp, 2157347 30.10.2012 01.12.2014 USA 8 ERP & ERP Corp, 1491044 03.01.2013 01.12.2014 USA 9 ERP & ERP Corp, 2170130 31.01.2013 01.12.2014 USA 10 ERP & ERP Corp, 572878 08.02.2013 01.12.2014 USA 11 ERP & ERP Corp, 1331983 04.03.2013 01.12.2014 USA Total 16442596

Whereas in terms of Paragraph 8 of Schedule 1 to Notification No.FEMA 20/2000-RB, if the shares are not issued within 180 days from the date of receipt of the inward remittance, the amount of consideration so received shall be refunded to the person concerned, provided the Reserve Bank may on an application made to it and for sufficient reasons permit to refund the amount of consideration received towards issue of security, if such amount is outstanding beyond a period of 180 days from the date of receipt. The amendment in Paragraph 8 of Schedule 1 to Notification No. FEMA 20/20000-RB was introduced by issue of Foreign Exchange Management (Transfer or Issue of Security by a Person outside India) (Third Amendment Regulation, 2007 notified, vide Notification No. FEMA 170/2007-RB dated 13th November, 2007 in the official Gazette of the Govt. of India.

3. (a) The applicant was given an opportunity for personal hearing vide Reserve Bank’s letter No. HY.FE.FID/687/14.66.003/2017-18 dated October 20, 2017 for Compounding of contraventions under FEMA 1999 M/s Atum IT Services India Private Limited CA No. HYD 232 further submission in person and/or producing documents, if any, in support of the application. (b) The applicant vide letter dated October 20, 2017 stated that they are foregoing appearing for the optional personal hearing and requested the disposal of the compounding application based on the documents submitted along with the application. The application for compounding is, therefore, being considered on the basis of the averments made in the application.

4. I have given my careful consideration to the documents on record. Accordingly, I hold that the applicant has contravened the following FEMA provisions issued in terms of:- (a) Paragraph 9 (1) (A) of Schedule 1 to Notification No. FEMA 20/2000-RB for delay in reporting the receipt of consideration towards issue of units amounting to `1,65,18,993 /- and the delay ranges from 1 month 7 days to 1 year 1 month 9 days approximately. (b) Paragraph 9 (1) (B) of Schedule 1 to Notification No. 20/2000-RB for delay in submission of Form FC-GPR to Reserve Bank after issue of shares to persons resident outside India and the contravention relates to an amount of ` 1,54,500 /-and the period of contravention ranges from 2 days to 5 days approximately.

(c) Paragraph 8 of Schedule 1 to Notification No.20/2000-RB for delay in allotment of units and the contravention relates to an amount of ` 1,64,42,596 /- and the delay ranges from 1 year 2 months 27 days to 1 year 7 months 28 days approximately.

5. In terms of Section 13 of the FEMA, any person contravening any provision of the Act shall be liable to a penalty up to thrice the sum involved in such contravention upon adjudication. However, taking into account the relevant facts and circumstances of the case as stated in the foregoing paragraphs, I am persuaded to Compounding of contraventions under FEMA 1999 M/s Atum IT Services India Private Limited CA No. HYD 232 take a lenient view on the amount for which the contravention is to be compounded and I consider that an amount of Rs. 1,32,034/- (Rupees One Lakh Thirty Two Thousand Thirty Four Only) will meet the ends of justice.

6. Accordingly, I compound the admitted contraventions, namely, the contraventions of Paragraph 9 (1) (A), Paragraph 9 (1) (B) and Paragraph 8 of Schedule 1 to Notification No. FEMA-20/2000-RB by the applicant on the facts discussed above in terms of the Foreign Exchange (Compounding Proceedings) Rules, 2000 on payment of an amount of Rs. 1,32,034/- (Rupees One Lakh Thirty Two Thousand Thirty Four Only) which shall be deposited by the applicant with the Reserve Bank of India, Foreign Exchange Department, 1st Floor, Saifabad, Hyderabad - 500004 by a demand draft drawn in favour of the "Reserve Bank of India" and payable at Hyderabad within a period of 15 days from the date of this order. In case of failure to deposit the compounded amount within the above mentioned period, Rule10 of the Foreign Exchange (Compounding Proceedings) Rules, 2000 dated May 3, 2000 shall apply.

The application is disposed accordingly.

Dated this 25th day of October 2017

Sd/- (R. Subramanian) Regional Director