Rampex Labs Pvt Ltd

In the RESERVE BANK OF INDIA Foreign Exchange Department Secretariat Road Saifabad, Hyderabad 500 004 Present Smt N Sara Rajendra Kumar General Manager Date: February 21, 2019 C.A. HYD 376 In the matter of M/s. Rampex Labs Private Limited Plot No.151, S.V. Co-operative Industrial Estate Village Road, IDA, Bollaram Sanga Reddy District Telangana – 502 325 (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 submitted the compounding application dated December 11, 2018 received by us on the same day for compounding of contraventions of the provisions of the Foreign Exchange Management Act, 1999 (FEMA) and the regulations issued there under. The contraventions sought to be compounded are (i) delay in reporting of receipt of foreign inward remittances towards subscription of equity, (ii) delay in submission of Form FCGPR to the Reserve Bank after issue of shares to a person resident outside India, in terms of Paragraph 9(1)(A) and Paragraph 9(1)(B) of Schedule 1 to Foreign Exchange Management (Transfer or Issue of Security by a Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 person resident outside India) Regulations, 2000 notified vide Notification No. FEMA. 20/2000-RB dated 3rd May 2000 as then applicable (herein after 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 as Private Limited Company under the Companies Act, 1956 on May 18, 2004 (CIN: U24239TG2004PTC043271). The company is engaged in the business of “Manufacture of medicinal substances used in the manufacture of pharmaceuticals". b) The applicant had received foreign inward remittances from the following foreign investors as indicated below: Sl Name of Remitter Total Amount Date of Date of No (INR) Receipt Reporting 1 Ranga NB Gorrepati 4,90,00,000 07-01-2006 06-02-2006 2 Ranga NB Gorrepati 38,45,288 13-09-2006 10-10-2006 3 Ranga NB Gorrepati 82,28,712 20-11-2006 06-12-2006 4 Ranga NB Gorrepati 30,73,000 24-01-2007 07-02-2007 5 Ranga NB Gorrepati 25,00,000 15-03-2007 09-04-2007 6 Ranga NB Gorrepati 21,50,000 30-03-2007 09-04-2007 7 Ranga NB Gorrepati 32,00,000 01-10-2007 03-10-2007 8 Ranga NB Gorrepati 74,00,000 10-09-2007 03-10-2007 9 Ranga NB Gorrepati 36,00,000 13-10-2007 12-11-2007 10 Ranga NB Gorrepati 43,00,000 15-11-2007 19-11-2007 11 Ranga NB Gorrepati 71,00,000 26-12-2007 31-12-2007 12 Ranga NB Gorrepati 5,00,000 27-12-2007 31-12-2007 13 Ranga NB Gorrepati 2,28,837.35 02-09-2011 14-01-2012

Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 14 Pallavi Gorrepati 75,81,236.25 18-01-2012 02-02-2012 15 Madhavi G Delsignore 75,44,492.38 24-01-2012 02-02-2012 MD 16 Prema Govindarajulu, 10,03,260 10-06-2014 28-06-2014 Pattabhiraman Govindarajulu 17 Lakshmi Vaitla 10,00,000 24-06-2014 28-06-2014 18 Lakshmi Vaitla 9,99,996 24-06-2014 28-06-2014 19 Pallavi Gorrepati 90,08,399 02-05-2014 30-05-2014 20 Raju S Dandu & Lakshmi 1,79,55,000 08-05-2014 30-05-2014 Dandu 21 Madhavi G Delsignore 90,09,000 02-05-2014 30-05-2014 MD 22 Uday Gorrepati or Shivani 30,02,399 02-05-2014 30-05-2014 Kanneganti 23 Surendra B Gorrepati & 30,02,640 02-05-2014 30-05-2014 Uma D Gorrepati 24 Indira Gorrepati 29,13,484 19-05-2014 30-05-2014 25 Indira Gorrepati 60,04,438 02-05-2014 30-05-2014 26 Ranga NB Gorrepati 33,34,000 13-10-2016 11-11-2016 27 Madhavi G Delsignore 82,19,315 28-11-2016 27-12-2016 MD 28 Raju S Dandu 1,36,05,320 09-01-2017 01-02-2017 29 Ranga NB Gorrepati 66,60,001 17-10-2016 12-11-2016 30 Ranga NB Gorrepati 40,92,787 23-11-2016 14-12-2016 31 Ranga NB Gorrepati 99,83,338 01-11-2016 29-11-2016 32 Prema Govindarajulu 23,28,934 20-10-2016 18-11-2016

Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 33 Pallavi Gorrepati 81,58,980 22-11-2016 20-12-2016 34 Lakshmi Vaitla or 54,17,664 25-10-2016 23-11-2016 Hanumanthu Rao Vaitla 35 Lakshmi Vaitla or 5,96,936 08-11-2016 29-11-2016 Hanumanthu Rao Vaitla 36 Rama Vaitla 4,75,320 22-11-2016 14-12-2016 37 Ranga NB Gorrepati 58,08,149 02-08-2017 31-08-2017 38 Ranga NB Gorrepati 74,00,000 31-08-2017 28-09-2017 39 Ranga NB Gorrepati 37,00,000 05-10-2017 21-10-2017 40 Ranga NB Gorrepati 37,00,000 29-09-2017 21-10-2017 41 Ranga NB Gorrepati 37,00,000 29-09-2017 21-10-2017 42 Ranga NB Gorrepati 3,00,000 22-11-2017 14-12-2017 43 Ranga NB Gorrepati 34,00,000 16-11-2017 14-12-2017 44 Ranga NB Gorrepati 50,00,000 09-01-2018 02-02-2018 45 Ranga NB Gorrepati 1,72,00,000 07-02-2018 19-02-2018 46 Pallavi Gorrepati 71,04,062 27-03-2018 21-04-2018 47 Pallavi Gorrepati 1,37,62,624 28-06-2018 18-07-2018 48 Madhavi Gorrepati 71,49,025 27-03-2018 21-04-2018 Delsignore MD 49 Ranga NB Gorrepati 3,99,97,000 21-05-2018 15-06-2018 50 Madhavi Gorrepati 1,37,58,968 28-06-2018 18-07-2018 Delsignore MD Total 35,90,02,604.98 The applicant reported receipt of remittances towards share subscription amounting to ₹ 35,90,02,604.98 to the Regional Office of Reserve Bank of India, out of which remittance amounting to ₹ 2,28,837.35 were reported with a delay of 3 months 10 days approximately beyond the prescribed limit. Whereas in terms of Paragraph

Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 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 equity shares and filed form FC-GPRs as indicated below:

Sl Name of investor Date of Number of Amount for Date of No allotment shares which shares reporting to of shares allotted (INR) AD or RBI 1 Ranga NB Gorrepati 29-03-2006 49,00,000 4,90,00,000 27-04-2006 2 Ranga NB Gorrepati 15-05-2007 19,79,700 1,97,97,000 06-06-2007 3 Ranga NB Gorrepati 11-03-2008 26,10,000 2,61,00,000 27-03-2008 4 Ranga NB Gorrepati 28-01-2012 15,280 2,29,200 24-02-2012 5 Pallavi B Gorrepati 28-01-2012 5,05,415 75,81,225 24-02-2012 6 Madhavi Gorrepati 28-01-2012 5,02,965 75,44,475 24-02-2012 Delsignore 7 Pallavi Gorrepati 30-06-2014 2,90,593 90,08,383 28-07-2014 8 Madhavi Gorrepati 30-06-2014 2,90,612 90,08,972 28-07-2014 9 Mrs Lakshmi Vaitla 30-06-2014 64,516 19,99,996 28-07-2014 10 Mrs Uma D 30-06-2014 96,859 30,02,629 28-07-2014 Gorrepati 11 Mrs Indira Gorrepati 30-06-2014 2,87,674 89,17,894 28-07-2014 12 Mrs Lakshmi Dandu 30-06-2014 5,79,193 1,79,54,983 28-07-2014 13 Mr Uday Gorrepati 30-06-2014 96,851 30,02,381 28-07-2014 14 Mrs Prema Govinda 30-06-2014 32,352 10,02,912 28-07-2014 Rajulu

Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 15 Ranga NB Gorrepati 10-12-2016 6,50,543 2,40,70,091 07-01-2017 16 Prema 10-12-2016 62,944 23,28,928 07-01-2017 Govindarajulu 17 Madhavi Delsingore 10-12-2016 2,22,143 82,19,291 07-01-2017 18 Pallavi Gorrepati 10-12-2016 2,20,512 81,58,944 07-01-2017 19 Hanumanthu Rao 10-12-2016 1,46,423 54,17,651 07-01-2017 Vaitla 20 Lakshmi Vaitla 10-12-2016 16,133 5,96,921 07-01-2017 21 Rama Vaitla 10-12-2016 12,846 4,75,302 07-01-2017 22 Raju S Dandu 08-03-2017 3,67,711 1,36,05,307 06-04-2017 23 Ranga NB Gorrepati 31-08-2017 1,56,977 58,08,149 09-10-2017 24 Ranga NB Gorrepati 28-10-2017 2,00,000 74,00,000 17-11-2017 25 Ranga NB Gorrepati 23-11-2017 4,00,000 1,48,00,000 14-12-2017 26 Ranga NB Gorrepati 08-02-2018 6,00,000 2,22,00,000 07-03-2018 27 Madhavi Gorrepati 15-05-2018 1,93,216 71,48,992 01-06-2018 Delsingore 28 Pallavi Gorrepati 15-05-2018 1,92,001 71,04,037 01-06-2018 29 Ranga NB Gorrepati 22-05-2018 10,81,000 3,99,97,000 21-06-2018 30 Madhavi Gorrepati 29-06-2018 3,71,864 1,37,58,968 28-07-2018 Delsingore 31 Pallavi Gorrepati 29-06-2018 3,71,962 1,37,62,594 28-07-2018 Total 1,75,18,285 35,90,02,225 The applicant filed form FCGPRs for the allotment of shares amounting to ₹ 35,90,02,225/- as indicated above, out of which remittance of ₹ 58,08,149/- was Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 reported with a delay of 9 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/1678/14.66.003/2018-19 dated February 14, 2019 for further submission in person and/or producing documents, if any, in support of the application. (b) The applicant appeared for personal hearing on February 19, 2019 during which Shri. J.V.V. Prasada Rao, Director, represented the applicant. The authorized representative of the applicant 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. 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 ₹ 2,28,837.35 with a delay of 3 months 10 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 ₹ 58,08,149/- with a delay of 9 days approximately.

Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 5. It has been declared in the compounding application dated December 11, 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 February 19, 2019 that the applicant was not under any enquiry/investigation/adjudication by any agency 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 ₹ 20,890/- (Rupees Twenty Thousand Eight Hundred and Ninety 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 ₹ 20,890/- (Rupees Twenty Thousand Eight Hundred and Ninety 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 Compounding of contraventions under FEMA 1999 M/s Rampex Labs Private Limited CA No. HYD 376 the Foreign Exchange (Compounding Proceedings) Rules, 2000 dated May 3, 2000 shall apply.

The application is disposed accordingly. Dated this 21st day of February 2019

Sd/- (N Sara Rajendra Kumar) General Manager