RBI–ED FEMA Matters: NOCs, Adjudication and Compounding Process

Summary: The supplied material is a set of 21 FAQs on RBI–ED matters under FEMA, 1999 concerning adjudication, No Objection Certificates (NOCs) and compounding. It states that FEMA is primarily a civil legislation and Section 15 provides for compounding eligible contraventions, subject to prescribed conditions and absence of investigation or other legal impediment. It describes the RBI-to-ED process, including reference, ED investigation under Section 16, complaint/adjudication where warranted, compounding application, ED NOC and subsequent RBI compounding. The material identifies publicly reported matters involving delayed FC-GPR, foreign inward remittance, APR and ODI reporting, foreign investment without required approval, land-border-country investments, and other FEMA contraventions. It lists matters involving Janapriya Townships, Nearbuy India, Genpact India, Elsteel Modular, Kakinada Seaports, Deccan Digital, Metrocorp Infrastructure, Myntra Designs, Jusda India, Apollo Hospitals, Darshan Kiritbhai Shah, Touras India and Apothecon Pharmaceuticals, with subsequent compounding or termination developments. It also refers to ED searches in June 2026 concerning alleged unauthorised cross-border VDA transfers and states that the publicly reported list is not necessarily complete.

21 FAQs on RBI – ED FEMA matters for adjudications, NOCs and Compounding

1. What is RBI – ED FEMA matters for adjudications, NOCs and Compounding?

(i) FEMA, 1999 is primarily a civil legislation and Section 15 provides a mechanism for compounding “eligible” contraventions.

(ii) The ED says that when the contravention is “eligible” for compounding, prescribed conditions are fulfilled and there is “no” investigation or other legal impediment, ED can issue an NOC to the RBI.

(iii) A July 2026 report stated that more than 150 FEMA cases had been terminated by the ED in the preceding 15 months and 45 cases compounded by the RBI since Jan 2026 “after” NOC from ED through RBI ED FEMA matters for adjudications, NOCs and Compounding.

(iv) We are able to interpret 13 cases as available in public domain for RBI ED FEMA matters for adjudications, NOCs and Compounding therefore unable to interpret the “balance” 137 cases (150-13).

2. Whether RBI is publishing a consolidated list of 100% references made to ED?

No

(i) We have the list below is the publicly reported/reliably traceable matters, “not” necessarily the complete 100% references made to ED by RBI.

(ii) We have gone through the publicly available ED press releases, RBI-related reports and major legal/news databases for 2025 and 2026.

3. What is scale of ED’s activities under FEMA, 1999?

(i) The Government’s 2025–26 Annual Report records that, between 1 April 2025 and 30 November 2025, ED initiated 2,242 FEMA, 1999 investigations, issued 119 Show Cause Notices (SCNs), adjudicated 49 cases, and imposed penalties for INR 84 crore.

4. What is flow chart for RBI ED adjudications, NOCs and Compounding?

• RBI compliance/regulatory issue
• RBI identifies / receives information regarding possible contravention
• Reference to the ED when appropriate
• ED investigation under section 16 of FEMA, 1999
• ED complaint / adjudication, when warranted
• Person/company may apply under Section 15 of FEMA, 1999 for compounding
• RBI refers compounding application to ED
• ED issue NOC, when “eligible” contravention and no impediment
• RBI issue compounding order “after” NOC from ED
• Termination of relevant adjudication/investigation

5. What are 11 important matters to be referred by RBI to ED for issuing NOC?

(i) When delayed in “FC-GPR” reporting

(ii) When delayed in “foreign inward remittances” reporting

(iii) When delayed in “APRs for ODI” filling

(iv) When made “further ODI/commitments” when earlier reporting is incomplete

(v) When foreign investment/share allotment “without” required approval

(vi) When transactions involving entities/persons from countries sharing a land border with India

(vii) When made unauthorised “cross-border” movement of funds

(viii) When foreign assets/investments where ownership, source or reporting is questionable

(ix) When complex structures “involving” overseas subsidiaries, trusts, funds or related parties

(x) When Virtual Digital Asset (VDA)

(x) When crypto-related cross-border transfers

6. What are 5 important matters already referred by RBI to ED for issuing NOC?

• The cases reveal 5 major referral triggers:

(i) Foreign investment reporting defaults by Janapriya, Kakinada, Deccan Digital and Apothecon:

(a) Advance Remittance Form (ARF)

(b) Foreign Currency – Gross Provisional Return (FC-GPR)

(c) Foreign Currency-Transfer of Shares (FC-TRS)

(d) Share allotment

(ii) Overseas Direct Investment (ODI) reporting defaults by Myntra:

• • Annual Performance Report (APR) filling defaults.

(iii) Foreign Investment (FI) in prohibited/restricted sectors by Apollo Hospitals:

(iv) Foreign Investment (FI) by entities/persons located in land-border countries in Jusda:

(v) Legacy FEMA matters already reaching adjudication by Genpact, Kakinada and Elsteel:

• • Several cases show that an old FEMA complaint can remain alive for years and later be resolved through compounding.

7. What is latest important search conducted by the ED under FEMA, 1999?

• The ED conducted under FEMA, 1999 searches in June 2026 at 6 premises in Bengaluru against alleged unauthorised cross-border transfers using VDAs, with bank accounts containing for INR 6 crore restrained during the investigation.

8. Who are entities/persons in the list of references made to ED by RBI?

9. What is Janapriya Townships for adjudications, NOCs and Compounding?

• This is one of the particularly useful cases for understanding the RBI → ED mechanism.

(i) The ED said that the investigation was based on credible information and identified, among other things, the delayed reporting of foreign inward remittances of INR 66 crore for issue of shares to a non-resident.

(ii) The RBI subsequently referred the matter to the ED for issuing NOC.

(iii) The RBI is permitted to compound the contraventions “after” NOC from ED.

(iv) The RBI has compounded the contraventions for INR 1,68,160.

10. What is Nearbuy India for adjudications, NOCs and Compounding?

(i) The RBI has compounded on Oct 17, 2025 “after” NOC from ED.

(ii) The ED has informed that proceedings against Nearbuy and the relevant office-bearers were consequently terminated “after” NOC to RBI.

11. What is Genpact India for adjudications, NOCs and Compounding?

(i) The Genpact is another important example of a legacy FEMA matter were resolved when the RBI has compounded “after” NOC from ED.

(ii) The RBI has compounded for INR 72 lac “after” NOC from ED.

12. What is Elsteel Modular India for adjudications, NOCs and Compounding?

(i) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(ii) The RBI has compounded the contravention on Dec 12, 2025 for INR 14,200.

13. What are Kakinada Seaports for adjudications, NOCs and Compounding?

(i) This is a particularly instructive case because there were 3 separate compliance failures for:

(a) A delay in reporting against foreign inward remittances for INR 87 cr

(b) A delay in filling FC-GPR for INR 31 crore

(c) A delay in issuing allotment of shares for INR 20 crore

(ii) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(iii) The RBI has compounded the contravention for INR 68 lac “after” receiving NOC from RBI.

14. What is Deccan Digital Networks for adjudications, NOCs and Compounding?

(i) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(ii) The RBI has compounded the contravention for INR 1,03,333 “after” NOC from RBI.

15. What is Metrocorp Infrastructure for adjudications, NOCs and Compounding?

(i) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(ii) The RBI has compounded the contravention for INR 1,03,333 “after” NOC from RBI.

16. What is Myntra matters for adjudications, NOCs and Compounding?

(i) The ED investigation was initiated in July 2025 based on credible information.

(ii) The matters compounded by the RBI for:

(a) Delayed in filling of Annual Performance Reports (APRs) against Overseas Direct Investment (ODI) for INR 85 crore.

(b) Undertaken ODI financial commitment for INR 03 crore when APRs were pending.

(iii) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(v) The RBI has compounded on April 20, 2026 the contravention for INR 88 Lac “after” NOC from RBI.

(v) Conclusion

• • • This is an excellent example showing that even procedural ODI reporting defaults can come within ED’s investigation.

17. What is Jusda India Supply Chain for adjudications, NOCs and Compounding?

(i) This is more serious from a regulatory perspective.

(ii) The Jusda issued shares for INR 5 crore to entities from a country sharing a land border with India i.e. China, Pakistan, Nepal, Bhutan, Bangladesh, Myanmar and etc. “without” obtaining prior Govt. approval.

(iii) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(iv) The RBI has compounded the contravention for INR 12,52,984 “after” NOC from RBI.

18. What are Apollo Hospitals for adjudications, NOCs and Compounding?

(i) This is probably the most financially significant publicly reported RBI→ED compounding matter during 2025-26.

(ii) The alleged contravention involved receipt of FDI in a “prohibited” retail-trading sector for INR 88 crore.

(iii) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(iv) The RBI has compounded the contravention for INR 77 crore “after” NOC from RBI.

19. What is Darshan Kiritbhai Shah for adjudications, NOCs and Compounding?

(i) The reported matter against delayed Foreign Currency – Transfer of Shares (FC-TRS) filing for INR 24,000 (only).

(ii) This is useful because it demonstrates that the quantum of the transaction alone does “not” necessarily determine whether a matter comes to ED’s attention.

(iii) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(iv) The RBI has compounded the contravention for INR 8470 “after” NOC from RBI.

20. What is Touras India for adjudications, NOCs and Compounding?

(i) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(ii) The RBI has compounded the contravention for INR 26,950 “after” NOC from RBI.

21. What is Apothecon Pharma for adjudications, NOCs and Compounding?

(i) The ED has investigated the matter and filed a complaint under Section 16 of FEMA, 1999 before the Adjudicating Authority, and thereafter issued NOC “after” reference from RBI.

(ii) The RBI has compounded the contravention for INR 52 lac “after” NOC from RBI.

• What is FEMA contravention RBI compounding and ED investigation?

(i) Delayed in FC-GPR/APR reporting can ultimately be compounded, as seen in Myntra and Apothecon.

But

(ii) The ED indicate “unauthorised” cross-border movement, concealment, benami/offshore structures, manipulation, prohibited investments, or transactions requiring approval, the matter can become substantially more serious.</p