RBI has issued the notification regarding Amendments to Directions – Compounding of Contraventions under FEMA, 1999.
Attention of Authorised Dealer (AD) Category – I banks is invited to the Guidelines for compounding of contraventions under FEMA, 1999, issued vide Circular dated October 1, 2024.
The provision contained at Paragraph 5.4.II.v of the aforesaid Circular, to link the Sum for which contravention is compounded (‘compounding amount’) payable to earlier compounding order, has been reviewed. In such cases, the applicant shall be deemed to have made a fresh application, and the compounding amount payable shall not be linked to the earlier compounding order. Accordingly, Paragraph 5.4.II.v of the A.P. (DIR Series) Circular dated October 1, 2024, stands deleted.
Further, as per the instructions laid down in Part B of Annexure I to the aforesaid Circular, when making payment through electronic mode, applicants are required to send an email communication to the concerned office of the Reserve Bank to reconcile the application fee/compounding amount received against the compounding applications submitted.
However, it has been observed that in some cases applicants do not make payment to the correct office of the Reserve Bank, and/or there is a delay in submitting the compounding application after making the application fee payment. These issues create difficulties in reconciling the received amounts and lead to delays in processing compounding applications. To address these challenges and improve turnaround time for processing compounding applications, it has been decided to include the following additional details in Part B of Annexure I of the above-referred circular:
- Mobile number of the applicant/ authorised representative.
- Office of the Reserve Bank (i.e., Central Office, Regional Office or FED CO Cell) to which the payment was made.
- Mode of submission of application (through PRAVAAH/ Physical).
Link – https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12838&Mode=0
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