New Delhi: Myntra Designs Private Limited has received regulatory relief in a FEMA-related case after the Reserve Bank of India compounded alleged foreign exchange violations, leading the Enforcement Directorate to formally close its investigation. The case involved delays in foreign investment reporting and overseas investment commitments made before completion of mandatory filings.
ED Probe Began Over FDI Compliance Concerns
The matter originated in July 2025, when the Enforcement Directorate began examining Myntra and related entities over suspected violations of foreign investment norms. The agency had flagged possible irregularities in compliance with Foreign Direct Investment regulations, with the overall exposure reportedly exceeding ₹1,654 crore.
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During the investigation, officials identified two key compliance issues. The first related to delays in submitting Annual Performance Reports connected to overseas investments. The second involved certain overseas investment commitments being undertaken before mandatory reporting requirements were completed.
RBI Compounds Two FEMA Contraventions
Following the ED’s observations, Myntra approached the RBI for compounding of the alleged violations under FEMA provisions. The central bank reviewed the matter and compounded two specific contraventions.
The first contravention involved delays in APR filings linked to foreign investments worth ₹42.85 crore. The second related to overseas investment commitments amounting to ₹3.03 crore that were made before completing the required compliance filings.
As part of the settlement, a one-time penalty of ₹2.88 lakh was imposed on the company. After the penalty was paid, the violations were formally closed under Section 15 of FEMA through the compounding mechanism.
Enforcement Case Formally Closed
Following the RBI order, the Enforcement Directorate confirmed that it had no objection to the compounding process and closed its investigation. The agency stated that once the regulatory authority had settled the matter and imposed penalties, further enforcement action was not required.
Officials said the compounding framework under FEMA is meant to resolve regulatory breaches through monetary penalties, especially in cases involving procedural or reporting lapses. The mechanism allows companies to regularise compliance while ensuring accountability.
With the conclusion of both RBI and ED proceedings, Myntra Designs Private Limited has received full regulatory closure in the matter. No further proceedings are currently pending, and the case has been formally closed by both authorities.
