Reserve Bank of India (RBI) has formally closed the chapter on alleged FEMA violations by Deccan Digital Networks Private Limited via a compounding order under Section 15, dated January 14, 2026. This move concludes all pending legal actions, following Enforcement Directorate’s (ED) clearance.
The saga started with ED’s intelligence-driven inquiry into suspected foreign exchange irregularities. Concluding their scrutiny, ED approached the adjudicating authority on December 27, 2012, under FEMA Section 16, pointing to reporting deficiencies in foreign investments.
Scrutiny uncovered that Rs 11.82 crore in overseas funds went unreported in time, coupled with overdue FC-GPR filings after equity issuance. These lapses violated core FEMA stipulations designed to ensure transparency in India’s forex regime.
Directors and officers received a show-cause notice on January 16, 2013. The company then sought compounding relief from RBI. Post ED’s review and no-objection, RBI sanctioned closure upon payment of Rs 1,03,333 as compounding charges.
By settling the matter, RBI averts prolonged adjudication and litigation, streamlining regulatory oversight. This outcome reflects a pragmatic enforcement strategy, where minor procedural faults are addressed through fines rather than punitive measures.
For corporates navigating FDI, the resolution emphasizes proactive compliance. Timely form submissions and receipt reporting are non-negotiable, as delays can trigger investigations despite eventual compounding options.