Ravulapati Techub Pvt Ltd

(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 November 22, 2018 received by us on November 30, 2018 for compounding of contraventions of the provision 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 remittance and (ii) delay in refund of excess share application money to a person resident outside India, in terms of Paragraph 9(1) (A) and Paragraph 8 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

Compounding of contraventions under FEMA 1999 M/s Ravulapati Techub Pvt Ltd CA No. HYD 362 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 25.01.2008 (CIN: U80301TG2008PTC057324). The company is engaged in the business of “providing all kinds of IT enabled computer programming and consultancy services in any field of business”. b) The applicant had received foreign inward remittances from single foreign investor as indicated below: Sl Name of Remitter Amount Date of Date of No (INR) Receipt Reporting 1 Rajender 29,85,765 25.09.2017 07.08.2018 Perumandla Total 29,85,765

The applicant reported receipt of remittances towards share subscription amounting to ₹ 29,85,765/- to the Regional Office of Reserve Bank of India, with a delay of 9 months 12 days approximately beyond the prescribed limit. 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 applicant has delayed in refund of share application money of ₹ 29,85,765/- to the foreign investor beyond the stipulated period of 180 days from the date of receipt of remittance. Here the period of contravention is 5 months 8 days approximately as shown below.

Compounding of contraventions under FEMA 1999 M/s Ravulapati Techub Pvt Ltd CA No. HYD 362

Sl Name of Date of Total Total Excess Date of No Remitter receipt amount amount share seeking received allotted application approval (INR) (INR) money from RBI (INR) 1 Rajender 25.09.2017 29,85,765 - 29,85,765 31.08.2018 Perumandla Total 29,85,765 29,85,765 Whereas in terms of Paragraph 8 of Schedule 1 to Notification No.FEMA 20/2000- RB read with A.P (DIR Series) Circular No. 20 dated December 14, 2007, 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/1337/14.66.003/2018-19 dated January 03, 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 December 14, 2018 during which Shri. Parcha Ajay, Director and Shri K. Ravi Reaghavan, Company Secretary represented the applicant. The Director and Authorized representative of the applicant admitted the contraventions for which the compounding has been sought.

Compounding of contraventions under FEMA 1999 M/s Ravulapati Techub Pvt Ltd CA No. HYD 362 During the personal hearing it was submitted that the delay was due to delay in receipt of FIRC from AD Bank and lack of guidance in the initial years. 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 ₹ 29,85,765/- with a delay of 9 months 12 days approximately. b) Paragraph 8 of Schedule 1 to Notification No. FEMA 20/2000-RB for delay in refund of share application money to the foreign investor and the contravention relates to an amount of ₹ 29,85,765/- with a delay of 5 months 8 days approximately. 5. It has been declared in the compounding application dated November 22, 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 November 22, 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

Compounding of contraventions under FEMA 1999 M/s Ravulapati Techub Pvt Ltd CA No. HYD 362 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 ₹ 70,511/-(Rupees Seventy Thousand Five Hundred Eleven Only) will meet the ends of justice. 7. Accordingly, I compound the admitted contraventions, namely, the contraventions of Paragraph 9(1) (A) 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 ₹ 70,511/-(Rupees Seventy Thousand Five Hundred Eleven 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, Rule 10 of the Foreign Exchange (Compounding Proceedings) Rules, 2000 dated May 3, 2000 shall apply.

The application is disposed accordingly. Dated this 17th day of January 2019

Sd/- (C Nageswara Rao) Deputy General Manager