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Forex tribunal penalises 10 MNCs

August 25, 2006 16:31 IST
The Appellate Tribunal for Foreign Exchange has upheld the penalties imposed on 10 MNCs, including Ericsson, Nokia and Sony, by the Special Director of Enforcement for violating foreign exchange regulations.

Ericsson India has been imposed with the highest penalty of Rs 15 crore (Rs 150 million) followed by Bank of Tokyo Mitsubishi of Rs 5.50 crore (Rs 55 million), Nokia India and Sony India Rs 5 crore (Rs 50 million)each, Motorola India, The Fuji Bank and Samsung Corporation have been imposed Rs 1 crore (Rs 10 million) each, Finance Minister P Chidambaram informed the Lok Sabha.

These companies had paid salaries and given perquisites to their expatriate employees abroad without the permission of RBI, the Minister said in a written reply.

As per available information, six MNCs and employees of one company have filed a writ petition in Delhi High Court against the
orders of the Appellate Tribunal for Foreign Exchange.

Ericsson, Motorola, Nokia, Samsung Corporation, Sony and the Fuji Bank have approached the Delhi high court challenging the Appellate Tribunal for Foreign Exchange's verdict upholding the penalty.

In most of the writ cases, the position is pending and the Delhi high court has asked the companies to furnish bank guarantee against payment of penalty, the minister said.

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

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