The Reserve Bank of India (RBI) has issued a compounding order on December 12, 2025, under section 15 of the Foreign Exchange Management Act (FEMA), 1999, for Kakinada Seaports Limited. This action follows the termination of proceedings against the company for alleged contraventions of FEMA regulations, as confirmed by an Enforcement Directorate (ED) statement. The compounding order was granted by the RBI subsequent to receiving a “no objection” certificate from the ED.
Based on credible information, the ED conducted an investigation into the company’s activities under FEMA regulations. Following the investigation, the ED lodged a complaint on September 5, 2024, before the adjudicating authority under Section 16 of FEMA, highlighting various contraventions. These violations included late reporting of foreign inward payments amounting to Rs. 22.88 crore, delays in filing Form FCGPR for shares totaling Rs. 23.31 crore, and delays in share allotments under FEMA provisions amounting to Rs. 7.21 crore.
The adjudicating authority issued a show cause notice on September 30, 2024, under Section 16 of FEMA to the company, its directors, and officers responsible for the company’s operations during the contravention period. Subsequently, the company applied to the RBI for compounding the violations under FEMA regulations as per Section 15 of the Act. With the ED’s “no objection” in place, the RBI compounded the contraventions on December 12, 2025, with a one-time payment of Rs. 21.68 lakh. This compounding has led to the cessation of adjudication proceedings and further legal actions against the company.
