India · FEMA Compounding
Late submission fees for reporting delays, compounding applications to the Reserve Bank under the 2024 Rules, and defence of FEMA show cause notices and adjudication before the Enforcement Directorate.
A FEMA contravention can be closed in three ways. A reporting delay of up to three years is usually settled by paying a late submission fee through the bank. Most other contraventions can be compounded with the Reserve Bank under the Foreign Exchange (Compounding Proceedings) Rules, 2024, for an application fee of Rs 10,000 plus GST, with an order due within 180 days. Contraventions that are not compounded go to adjudication, where the penalty can reach three times the sum involved.
A review of every foreign investment and remittance against the reporting it needed, usually before a funding round, sale or bank review.
Regularisation of reporting delays within three years through the bank or the FIRMS portal.
The application, annexures and computation, and representation at the personal hearing before the Reserve Bank.
The overdue filings, valuations, refunds or approvals that must be completed before a contravention can be compounded.
Replies to show cause notices under section 16 of FEMA, with the sum involved and the period computed correctly.
Appeals to the Special Director (Appeals) and the Appellate Tribunal, where chartered accountants may appear under section 32.
Every transaction, the filing it needed and the date it was due.
Late submission fee, compounding or adjudication, transaction by transaction.
Complete the filing, valuation or approval that is still missing.
Pay, obtain the order, and keep it with the records for the next diligence.
A compounding order closes the FEMA contravention. The tax and company law consequences need closing too, and we handle both.
ODI, FDI and ECB structuring and reporting.
Explore →◆PMLA and FEMA proceedings: summons, attachment, adjudication, bail.
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Explore →◆Treaty, withholding and permanent establishment disputes.
Explore →| Route | When it applies | Who decides | Cost and time |
|---|---|---|---|
| Late submission fee | Reporting delay within three years of the due date | Authorised dealer bank or the FIRMS portal | Rs 7,500 plus 0.025% of the amount for each year of delay for forms that report a flow of funds; Rs 7,500 for returns such as the APR |
| Compounding | Most other contraventions, and reporting delays beyond three years | Reserve Bank (or the Enforcement Directorate where it has the case) | Application fee Rs 10,000 plus GST; amount fixed by order within 180 days; pay within 15 days |
| Adjudication | Contraventions not compounded, or taken up by the ED | Adjudicating Authority under section 16 | Penalty under section 13 up to three times the sum involved |
| Forum | Provision | Time to appeal | Notes |
|---|---|---|---|
| Special Director (Appeals) | Section 17 | 45 days | Orders of Adjudicating Authorities below the specified rank |
| Appellate Tribunal | Section 19 | 45 days | The Tribunal can require deposit of the penalty, or waive it |
| High Court | Section 35 | 60 days | Questions of law |
Use our FEMA late submission fee calculator for a first estimate, and see FEMA compounding and the late submission fee for the detail. For ongoing reporting, see FEMA and RBI advisory.
Prepared by the LexVerge editorial team and reviewed by Vijay Dhawan, Managing Partner, on 11 October 2026. Facts checked against the Acts, rules, regulations and judgments cited on this page on 11 October 2026. General information, not legal advice: deadlines run from the date of your notice or order, so confirm them for your matter.
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