Brun Health Pvt. Ltd.

In the RESERVE BANK OF INDIA Foreign Exchange Department Secretariat Road Saifabad, Hyderabad -500 004 Present K R K Reddy Deputy General Manager Date: September 27, 2016 C.A. HYD 148 In the matter of M/s. Brun Health Private Limited A-33-113/7 Harinivas Asha Officers Colony R.K. Puram Secunderabad 500056. (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 03, 2016 received on August 10, 2016 for compounding of contravention of the provisions of the Foreign Exchange Management Act, 1999 (the FEMA) and the regulations issued there under. The contraventions sought to be compounded are (i) delay in reporting receipt of foreign inward remittances and (ii) delay in submission of Form FC-GPR to the Reserve Bank after issue of shares towards subscription to equity to a person resident outside India in terms of Paragraph 9 (1) (A) and Paragraph 9 (1) (B) 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

FED M/s. Brun Health Private Limited CA No. HYD 148 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 incorporated on September 05, 2014. The company is engaged in the business of medical device including designing, development and manufacturing, innovations and developing various solutions for healthcare, trading, importing, and exporting of all types of medical devices.

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

Sl No Name of Remitter Date of Total Date of Reporting Receipt Amount (`)

1 Mr. Jayesh Arvind Parekh 14.11.2014 5,60,000 29.01.2015 2 Mr. Jayesh Arvind Parekh 06.07.2015 5,60,000 21.09.2015 3 Mr. Jayesh Arvind Parekh 07.08.2015 1,660 21.09.2015 Total 11,21,660

The applicant reported receipt of remittances towards share subscription amounting to ` 11,21,660/- to the Regional Office of Reserve Bank of India on dates indicated above with a delay ranging from 14 days to 1 months 15 days approximately as indicated above. 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.

FED M/s. Brun Health Private Limited CA No. HYD 148 c) The company allotted equity shares and filed form FC-GPRs as indicated below.

Sl Name of investor Date of Number of Amount for Date of No allotment of shares/CCPS which shares reporting shares allotted allotted (`) Mr. Jayesh Arvind 1 equity share 29.01.2015 1 14.11.2014 5,60,000 Parekh and 139 CCPS Mr. Jayesh Arvind 21.09.2015 2 14.08.2015 110 CCPS 5,61,660 Parekh Total 11,21,660

The applicant filed form FCGPRs for the allotment of shares amounting to `11, 21,660/-as indicated above with delays ranging from 8 days to 1 month and 15 days approximately beyond the prescribed limit. 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.

3. a) The applicant was given an opportunity for personal hearing vide Reserve Bank’s letter No. HY.FE.FID/578/14.66.003/2016-17 dated September 16, 2016 for further submission in person and/or producing documents, if any, in support of the application. (b) The applicant appeared for personal hearing on September 23, 2016 during which Shri. Anirudh Chaturvedi, Co-founder, Managing Director of the company represented the applicant. The applicant admitted the contraventions for which the compounding has been sought. During the personal hearing it was submitted that the delay was due to administrative reasons in initial time and was not willful or with a malafide intention. In view of the foregoing, the applicant requested to take a lenient view in disposal of the FED M/s. Brun Health Private Limited CA No. HYD 148 application. The application for compounding is, therefore, being considered on the basis of the averments made in the application as well the submissions made in this context by the applicant during the personal hearing. 4. I have given my careful consideration to the documents on record and submission made by the applicant during the personal hearing.

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 due to delay in reporting of receipt of foreign inward remittances towards subscription to equity shares as detailed above. The contraventions relate to an amount of 11,21,660- and the duration of contravention ranges from 14 days to 1 month 15 days approximately. ₹ (b) Paragraph 9 (1) (B) of Schedule 1 to Notification No. 20/2000-RB due to 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 11,21,660/- and the duration of contravention ranges from 8 days to 1 month 15 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 take a lenient view on the amount for which the contravention is to be compounded and I consider that an amount of 20,000/- (Rupees Twenty Thousand only) will meet the ends of justice.

6. Accordingly, I compound the admitted contraventions namely, the contraventions of ₹ Paragraph 9 (1) (A) and Paragraph 9 (1) (B) 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 20,000/- (Rupees Twenty Thousand 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 favor 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,

FED M/s. Brun Health Private Limited CA No. HYD 148 Rule10 of the Foreign Exchange (Compounding Proceedings) Rules, 2000 dated May 3, 2000 shall apply.

The application is disposed accordingly.

Dated this twenty seventh day of September 2016.

Sd/- (K R K Reddy) Deputy General Manager