RBI Closes ED Probe into Myntra Designs After FEMA Violations Compounded
Quick Look
- The Reserve Bank of India has closed an Enforcement Directorate investigation into Myntra Designs Private Limited after compounding certain Foreign Exchange Management Act violations.
- The company faced allegations of delays in submitting overseas investment reports and undertaking commitments before compliance, leading to a one-time monetary penalty.
AI-generated summary
The Reserve Bank of India (RBI) has compounded certain violations of the Foreign Exchange Management Act (FEMA) by Myntra Designs Private Limited, paving the way for the closure of an Enforcement Directorate (ED) investigation into the matter.
In a statement issued on Thursday, the ED said the RBI passed a compounding order on April 20, 2026 under Section 15 of FEMA after receiving a "No Objection" from the agency. The order resulted in the termination of the investigation against the company for the alleged contraventions.
The case stemmed from an ED probe initiated in July 2025 on the basis of what the agency described as credible information regarding possible FEMA violations by Myntra, linked companies and directors for FDI "contravention" of over Rs 1,654 crore.
According to the ED, the violations related to delays in submitting Annual Performance Reports (APRs) for overseas investments and undertaking overseas direct investment commitments before complying with reporting requirements.
The RBI compounded two contraventions. The first involved a delay in submitting APRs under the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004, covering transactions worth Rs 42.85 crore. The second related to undertaking financial commitments through overseas direct investment despite pending APR submissions, involving Rs 3.03 crore.
The company subsequently approached the RBI seeking compounding of the violations under Section 15 of FEMA.
"On reference from RBI, the ED issued no objection for such compounding in line with the true spirit of the Act," the agency said.
Following the ED's no-objection, the RBI compounded the violations through its order dated April 20, 2026, on payment of a one-time amount of Rs 2.88 lakh.
