FEMA cases filed against 15 companies over Rs 17,789.9 crore: Says Government

FEMA cases filed against 15 companies over Rs 17,789.9 crore: Says Government 

These Companies have received FDI from tax havens like Mauritius, Singapore and Virgin Islands

Government has filed cases under Foreign Exchange Management Act (FEMA) amounting to Rs 17,789.9 crore against 15 companies that have received Foreign Direct Investment (FDI) from tax havens like Mauritius, Singapore and Virgin Islands, Parliament was informed on Friday.

"ED has registered cases under the Prevention of Money Laundering Act (PMLA), 2002, against one company for Rs 18.27 crore and under the FEMA, 1999, against 15 companies amounting to Rs 17,789.92 crore, which have received FDI from tax havens like Mauritius, France, Cyprus, Singapore, Virgin Islands, Luxembourg, Dubai and Tunisia," Minister of State for Finance Santosh Kumar Gangwar said in a written reply to the Lok Sabha.

In recent times, Gangwar said, the government has taken several steps, both by way of policy-level initiative and more effective enforcement action on the ground, to tackle tax evasion, particularly with reference to undisclosed foreign assets or income.

Courtesy: Press Trust of India

ED probing 81 FDI cases over FEMA violation: Commerce and Industry Minister Nirmala Seetharaman

ED probing 81 FDI cases over FEMA violation: Commerce and Industry Minister Nirmala Seetharaman

As many as 81 cases have been under investigation by the Enforcement Directorate (ED) for alleged violation of provisions of the Foreign Exchange Management Act (FEMA) relating to foreign direct investment (FDI).

“Of the 81 cases, show-cause notices were issued in 22 cases,” Commerce and Industry Minister Nirmala Seetharaman said in a written reply to the Lok Sabha.

The other remaining 59 cases are at various stages of probe, she said, adding “disclosure of names of companies and other details of these cases at this stage may not be in public interest, as the same may hamper the investigations”.

These 81 cases were between 2013 and June 30, 2016. Replying to a separate question, she said no decision had been taken by the government to impose a ban on FDI in the tobacco sector. According to the policy, FDI is banned in manufacturing of cigars, cheroots, cigarillos and cigarettes of tobacco or tobacco substitutes. FDI in other activities relating to these products, including wholesale cash and carry, retail trading and the like shall be governed by the applicable restrictions.

Courtesy: Press Trust of India

RBI has the power to impose penalty for non-filing of FLA Annual return on Foreign Liabilities and Assets- UNDER FEMA

RBI has the power to impose penalty for non-filing of FLA Annual return on Foreign Liabilities and Assets- UNDER FEMA

Annual return on Foreign Liabilities and Assets has been notified under FEMA 1999 and it is required to be submitted by all the India resident companies which have received FDI and/ or made overseas investment in any of the previous year(s), including current year by July 15 every year. Non-filing of the return before due date will be treated as a violation of FEMA and penalty clause may be invoked for violation of FEMA.

Whether non-filing of earlier years also attract penalty?

Yes. But, it is advisable to file the FLA return this Year and this will cover up what ever you have omitted to declare last years.

Whether RBI has levied any penalty for filing of FLA on Companies int?

There is no clear cut answer or statistics available on the subject and quantum of fine is at the discretionary of the RBI .