FZE Food Analysts Pvt Ltd

In the Reserve Bank of India Foreign Exchange Department Mumbai Regional Office Main Building, 3rd floor Shahid Bhagat Singh Marg, Fort Mumbai 400 001 Present Shri Sunil Pethkar Assistant General Manager August 22, 2019 CA No. MUM 892/2019 In the matter of M/s FZE Food Analysts Private Limited Building No. 27, Flat No. 602, Rajdeep CHS, Opposite Shivaji Ground, Nehrunagar, Kurla East, Mumbai 400 024 (Applicant) In exercise of the powers conferred under section 15(1) of the Foreign Exchange Management Act, 1999 and the Regulations/Rules/Notifications/Orders made thereunder, I pass the following Order 1 The applicant has filed the compounding application dated April 16, 2019, received at the Reserve Bank on April 26, 2019, for compounding of contravention/s of the provisions of the Foreign Exchange Management Act, 1999 (the FEMA) and the regulations issued thereunder. The contravention/s sought to be compounded are in respect of the following (Regulations/ paras under 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 May 3, 2000 and as amended from time to time (hereinafter referred to as FEMA 20):

I Para 9 (1) (A) of FEMA 20: Delay in reporting receipt of foreign inward remittance towards subscription to equity II Para 9 (1) (B) of FEMA 20: Delay in filing Form FC GPR to Reserve Bank after issue of shares to person resident outside India

FED, MRO, CEFA, M/s FZE Food Analysts Pvt Ltd, CA No: MUM 892/2019

III Para 8 of FEMA 20: Neither the equity instruments were issued, nor the money refunded to the foreign investor within 180 days from the receipt of the inward remittance 2 Brief details of the applicant company are as follows: Date of Incorporation March 15, 2017 Its main activities are: Other human health activities n.e.c. (including independent ambulance activities

3 The applicant received foreign inward remittances from non-resident investor towards equity shares / compulsorily convertible preference shares/ compulsorily convertible debentures and it reported the same to the Reserve Bank on dates as indicated below. Delay in reporting Foreign Direct Investment &/or delay in allotting the shares/ refunding the amount (whereas, "Y" represents delay in number of years, "M" represents delay in number of months and "D" represents delay in number of days, and LSF stands for : Late Submission Fees S Date of Amount received Date of Para 9 (1) A Date of Para 8 No/ inward (in INR) reporting to delay allotment delay LSF remittanc RBI / refund e (DD-MM-YY) (DD-MM-YY) (DD-MM-YY) 1 24-05-17 1,00,000.00 21-08-17 0Y 1M 27D 15-03-17 0Y 2M 9D 1 24-05-17 6,00,000.00 21-08-17 0Y 1M 27D 06-08-17 0 1 24-05-17 7 0,436.00 21-08-17 0Y 1M 27D 24-01-19 1Y 2M 4D TOTAL 7,70,436.00 In terms of Para 9 (1) (A) of FEMA 20, 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. However the applicant reported receipt of remittance to the Reserve Bank of India on date indicated above with a delay of 0Y 1M 27D. 4 In respect of remittances amounting to Rs.1,70,436/- (Rupees One Lakh Seventy Thousand Four Hundred and Thirty Six Only), indicated in the table above the company refunded the remittance amount to the Non Resident investor for Rs 70,436/- (Rupees Seventy Thousand Four Hundred and Thirty Six Only) after 180 days from the date of receipt of investment with a delay of 1Y 2M 4D. Against the balance amount of Rs 1,00,000 (Rupees One lakh Only), the shares were allotted before receiving the foreign Investment and the delay in receiving foreign investment was 2M 9D. Whereas in terms of para 8 of FEMA 20, an Indian company is required to issue shares or refund the amount within 180 days from the date of receipt of inward remittance.

FED, MRO, CEFA, M/s FZE Food Analysts Pvt Ltd, CA No: MUM 892/2019

5 The company allotted equity shares/compulsorily convertible preference shares/compulsorily convertible debentures and filed FC-GPRs as indicated below:

Delay in filing Form FCGPR (whereas, "Y" represents delay in number of years, "M" represents delay in number of months and "D" represents delay in number of days, LSF stands for : Late Submission Fees, IP stands for Issue Price and FV stands for Face Value Sno/ Date of Number of IP (FV+ Amount (IP*no Date of Para 9 (1) LSF allotment shares premium) of shares) reporting (B) delay (DD-MM-YY) (in INR) (in INR) (DD-MM-YY)

1 15-03-17 10000 10.00 1,00,000.00 20-11-17 0Y 7M 5D 2 06-08-17 60000 10.00 6,00,000.00 20-11-17 0Y 2M 14D TOTAL 7,00,000.00 The applicant filed form FC-GPRs as indicated above with a delay ranging from 0Y 2M 14D to 0Y 7M 5D. Whereas, in terms of Para 9(1) (B) of FEMA 20, an Indian company issuing shares in accordance with these Regulations has to submit to RBI a report in Form FC-GPR along with documents prescribed therein within 30 days from the date of issue of shares to Non Resident.

6 The applicant was given an opportunity for personal hearing, for further submission in person and/or for producing documents, if any, in support of the application vide e-mail dated August 01, 2019. The applicant applied for waiver of personal hearing vide e mail dated August 03, 2019. The applicant, in the compounding application, had admitted the contraventions as stated above for which compounding has been sought. It had been submitted that the contraventions were not wilful and were unintentional. The application for compounding is, therefore, being considered on the basis of the averments made in the application as well as other documents and submissions made in this context by the applicant.

7 I have given my careful consideration to the documents on record and thereafter. Accordingly, I hold that the applicant has contravened the following FEMA provisions issued in terms of:

I Para 9 (1) (A) of FEMA 20, due to the delay in reporting of receipt of foreign inward remittance towards subscription towards shares as detailed above. The contravention relates to total amount of Rs.7,70,436 (Rupees Seven Lakh Seventy Thousand Four Hundred Thirty Six and Zero Paise Only) with a delay of 0Y 1M 27D approximately.

II Para 9 (1) (B) of FEMA 20, due to the delay in submission of Form FC-GPR to the Reserve Bank after issue of shares to persons resident outside India and the contravention relates to total amount of Rs.7,00,000 (Rupees Seven Lakh and Zero Paise Only) and with a delay ranging from minimum 0Y 2M 14D to maximum 0Y 7M 5D approximately.

FED, MRO, CEFA, M/s FZE Food Analysts Pvt Ltd, CA No: MUM 892/2019

III Para 8 of FEMA 20, since the shares were neither issued nor the amount was refunded to the person resident outside India within the prescribed time from the date of receipt of the inward remittance. The contravention relates to total amount of Rs.1,70,436 (Rupees One Lakh Seventy Thousand Four Hundred Thirty Six and Zero Paise Only) and with a delay ranging from minimum 0Y 2M 9D to maximum 1Y 2M 4D approximately. 8 It has been declared in the compounding application dated April 16, 2019 that the particulars given by the applicant in the application are true and correct to the best of their/his/her knowledge and belief. It has also been declared in a declaration attached to the compounding application that the applicant was not under any enquiry/investigation/adjudication by any agency as on the date of the application and has, in this regard, not informed of initiation of any such enquiry/investigation/ adjudication proceedings against it/him/her thereafter. It has further been declared that the applicant has not filed any appeal under section 17 or section 19 of FEMA, 1999. Accordingly, the above contraventions which are being compounded in this Order are subject to the veracity of the above declarations made by the applicant and this order is without prejudice to any other action which may be taken by any authority under the extant laws if the said declarations are subsequently discovered to be false and/or incorrect. 9 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 contraventions are to be compounded and I consider that an amount of Rs.52,086 (Rupees Fifty Two Thousand Eighty Six and Zero Paise Only) will meet the ends of justice.

10 Accordingly, I compound the admitted contravention/s namely, the contravention/s of Para 9 (1) (A) of FEMA 20, Para 9 (1) (B) of FEMA 20 and Para 8 of FEMA 20, 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. 52,086 (Rupees Fifty Two Thousand Eighty Six and Zero Paise Only) which shall be deposited by the applicant with the Reserve Bank of India, Foreign Exchange Department, Mumbai Regional Office, Main Building, 3rd floor, Shahid Bhagat Singh Marg, Fort, Mumbai-400001 by a demand draft drawn in favour of the "Reserve Bank of India" and payable at Mumbai 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, Rule 10 of the Foreign Exchange (Compounding Proceedings) Rules, 2000 dated May 3, 2000 shall apply.

11 The above order is passed only in respect of contraventions of Para 9 (1) (A) of FEMA 20, Para 9 (1) (B) of FEMA 20 and Para 8 of FEMA 20 and does not restrict the right of any other authority to proceed against the Company for any other violations/contraventions noticed at any point of time.

FED, MRO, CEFA, M/s FZE Food Analysts Pvt Ltd, CA No: MUM 892/2019

12 The application is disposed of accordingly. dated: August 22, 2019 Compounding Authority (Sunil Pethkar) Assistant General Manager