Idealoom Ventures Pvt. Ltd.

In the RESERVE BANK OF INDIA Foreign Exchange Department Secretariat Road Saifabad, Hyderabad 500 004 Present C Nageswara Rao Deputy General Manager Date: September 26, 2018 C.A. HYD 324 In the matter of M/s. Idealoom Ventures Private Limited D. No. 12-7-134/RBV/C-702 Flat No. 702, C-Block Rainbow Vistas, Green Hills Road Moosapet, Hyderabad - 500018 (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 06, 2018 received on August 09, 2018 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 and (ii) delay in submission of Form FC-GPR to Reserve Bank of India after issue of shares towards subscription to equity in terms of Paragraph 9(1)(A) and Paragraph 9(1)(B) respectively 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 May

Compounding of contraventions under FEMA 1999 M/s Idealoom Ventures Private Limited CA No. HYD 324 03, 2000 (hereinafter referred to as Notification No. FEMA 20/2000-RB) as then applicable. 2. The relevant facts of the case are as follows: a) The applicant is a resident company originally incorporated as M/s. Sreshta I.T. Infrastructure Services Private Limited under the Companies Act, 1956 on 29.12.2004 (CIN: U74110TG2004PTC044998) and later changed its name to M/s. Idealoom Ventures Private Limited. The company is engaged in the business of computer consultancy and computer facilities management activities. b) The applicant had received foreign inward remittances from single foreign investor towards advance for subscription to equity shares as indicated below. Sl Name of the Remitter Total Date of Date of No Amount Receipt Reporting (INR) 1 Zakeer Hussain Khalifa 50000 31.01.2017 28.02.2017 2 Zakeer Hussain Khalifa 150000 03.02.2017 28.02.2017 3 Zakeer Hussain Khalifa 300000 06.02.2017 28.02.2017 4 Zakeer Hussain Khalifa 18000 13.02.2017 28.02.2017 5 Zakeer Hussain Khalifa 200000 05.03.2017 31.03.2017 6 Zakeer Hussain Khalifa 250000 04.04.2017 25.05.2017 7 Zakeer Hussain Khalifa 250000 13.04.2017 29.05.2017 8 Zakeer Hussain Khalifa 240000 04.05.2017 29.05.2017 9 Zakeer Hussain Khalifa 4000000 19.01.2018 07.02.2018 Total 54,58,000

The applicant received the foreign inward remittances amounting to `54,58,000/-as indicated above out of which remittances amounting to `5,00,000/- were Compounding of contraventions under FEMA 1999 M/s Idealoom Ventures Private Limited CA No. HYD 324 reported to Reserve Bank of India with delays ranging from 16 days to 21 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 the Date of Number of Amount for Date of No Investor allotment shares/CC which shares reporting of shares PS allotted allotted (INR) 1 Zakeer Hussain 31.03.2017 71800 718000 13.09.2017 Khalifa 2 Zakeer Hussain 30.04.2017 50000 500000 13.09.2017 Khalifa 3 Zakeer Hussain 30.05.2017 24000 240000 13.09.2017 Khalifa 4 Zakeer Hussain 19.01.2018 400000 4000000 13.02.2018 Khalifa Total 5,45,800 54,58,000

The applicant filed form FCGPRs for issue of shares amounting to `54,58,000/- as indicated above out of which shares amounting to `14,58,000/- were reported with delays ranging from 2 months 15 days to 4 months 14 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 Compounding of contraventions under FEMA 1999 M/s Idealoom Ventures Private Limited CA No. HYD 324 these Regulations has to submit to Reserve Bank of India 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/385/14.66.003/2018-19 dated September 18, 2018 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 24, 2018 during which Shri. Shanawaz Khalifa, Managing Director and Ms. Shipra Verma, Law Associate represented the applicant.

The Managing Director of the company admitted the contraventions for which the compounding has been sought. During the personal hearing it was submitted that the delay was not wilful or with a malafide intention but was on account of administrative reasons. In view of the foregoing, the representative of the applicant requested to take a lenient view in disposal of the 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. 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 shares amounting to `5,00,000/- and the delay ranges from 16 days to 21 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 of India after issue of shares to persons resident outside India and the contravention relates to an amount of ` 14,58,000/- and the period of contravention ranges from 2 months 15 days to 4 months 14 days approximately.

Compounding of contraventions under FEMA 1999 M/s Idealoom Ventures Private Limited CA No. HYD 324 5. It has been declared in the compounding application dated August 06, 2018 that the particulars given by the applicant in the application are true and correct to the best of their knowledge and belief. It has been declared in the declaration dated August 06, 2018 furnished with 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 thereafter. 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. 6. 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 ` 21,160/- (Rupees Twenty One Thousand One Hundred Sixty Only) will meet the ends of justice. 7. 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 ` 21,160/- (Rupees Twenty One Thousand One Hundred Sixty 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 Compounding of contraventions under FEMA 1999 M/s Idealoom Ventures Private Limited CA No. HYD 324 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 26th day of September 2018

Sd/- (C Nageswara Rao) Deputy General Manager