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Forex violation: 11 MNCs in India found guilty

Last updated on: July 28, 2006 20:47 IST

Global giants Nokia, Sony and Ericsson were among 11 multinational corporations, whose Indian operations were found guilty of violating foreign exchange regulation by an Appellete Tribunal.

In its ruling earlier last week, Appellate Tribunal for Foreign Exchange also confirmed a penalty of Rs 361.20 million (Rs 36.1 crore) imposed by Enforcement Directorate on them, official sources said.

Terming this as an important case for the Directorate of Enforcement, they said violation by the Indian arms of the foreign companies related to payment of salaries to their expatriate employees working in India

in foreign currency.

This was done without the permission of the Reserve Bank of India and ED had issued various show cause notices to Motorola India (P) Ltd, Nokia India (P) Ltd, Sony India, Fuji Bank, Bank of Tokyo-Mistubishi Ltd, Sumitomo Mitsui Banking Corporation and Deutche Bank AG on the ground that they had contravened the provisions of Section 8(1) of FERA, 1973.

The Act "casts the responsibility on the persons resident in India who have any amount of foreign exchange due or accrued in their favour to get the same realised and repatriated to India within the specific period and the manner specified by RBI."

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