CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Foreign Exchange Management
Mehta Exports Ltd contravenes a FEMA rule by remitting Rs 10 lakh in breach of a RBI direction. The amount involved is quantifiable and the contravention is not continuing. Under Section 13(1), what is the maximum penalty the adjudicating authority can impose?
The maximum penalty is Rs 30 lakh. Section 13(1) permits a penalty up to three times the sum involved when the amount is quantifiable, and three times Rs 10 lakh is Rs 30 lakh. The Rs 2 lakh cap applies only to unquantifiable contraventions.
- ARs 2 lakh
- BRs 10 lakh
- CRs 20 lakh
- DRs 30 lakhCorrect
Explanation
Section 13(1) provides a penalty up to thrice the sum involved where the amount is quantifiable. Thrice Rs 10 lakh is Rs 30 lakh. The Rs 2 lakh figure applies only where the amount is not quantifiable, so it is wrong here.
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