Google India managers asked to provide 50% of FEMA fines as Bank Guarantee | Company Business News

The Karnataka High Court has ordered Google India and three of its senior executives to 50 percent of fines imposed, due to the alleged foreign exchange management (FEMA) violations, as bank guarantees. The Enforcement Directorate (ED) earlier charged a £ 5 fine on Google India, along with a joint fine of £ 45 Lakh on the three officials. The case relates to alleged violations of section 6 (3) (d) of FEMA, with transactions worth £ 364. According to the ED, the offenses are related to the payments made by Google India to Google Ireland as distribution fees and for the acquisition of Google US equipment. The agency argued that £ 363 crore, payable to Google Ireland, remained unpaid for more than four years to May 2014, while paying equipment of £ 1 from Google US from Google US for more than seven years to January 2014. The ED classified it as commercial loans, which would require prior approval of the Reserve Bank or India (RBI). However, Google India disputed these allegations and claimed that the relevant transactions were not foreign exchange loans. The company emphasized that there were no loan agreements, deferred payments or interest involved, and demanded compliance with an RBI impairment letter issued on July 1, 2014. Earlier, on January 11, 2019, the Appeal Tribunal for Fema in Delhi granted a stay on the fines, referring to the attraction of Google India. The ED subsequently filed second appeals that challenge the accommodation. A divisional bank consisting of Justices v Kameshwar Rao and S Rachaeah noted that the residence of the tribunal was based solely on a preliminary view. They have now instructed Google India and the officials concerned to provide bank guarantees for half the total fines within two weeks that were first published: 15 Apr 2025, 04:32 PM IST