RBI Issues Compounding Order Against BPTP Limited for FEMA Violations

New Delhi, October 1 (Daily Kiran) : The Reserve Bank of India (RBI) has taken action against real estate developer BPTP Limited and its directors, Kabir Chawla and Sudhanshu Tripathi, for violations of the Foreign Exchange Management Act (FEMA). The company has agreed to pay a total of ₹4.84 crore as a compounding amount related to foreign direct investment (FDI) transactions from 2007 and 2008.

This case emerged from an investigation by the Enforcement Directorate (ED) at its Gurugram zonal office, which scrutinized the FDI received by BPTP Limited, previously known as Business Park Town Planners Private Limited.

The investigation focused on approximately ₹537.5 crore of foreign investment received from Mauritius-based CPI India L Limited and Harbour Victoria Investment Holding Limited. The RBI noted that on September 17, 2026, it issued a compounding order under Section 15(1) of FEMA, 1999, along with its associated rules and regulations.

According to the findings, BPTP received around $7.767 million (approximately ₹322.5 crore) from CPI India L Limited on August 21, 2007, and about $4.984 million (around ₹215 crore) from Harbour Victoria Investment Holding Limited on July 9, 2008.

The investigation revealed that the investment agreements included provisions for put options and guaranteed internal rates of return (IRR) for investors. Such conditions were not permissible under the FEMA regulations in place at that time.

The ED alleged that while BPTP obtained foreign investment under the automatic route, it offered investors guaranteed returns through swap and put option arrangements. These agreements were found to contradict the provisions of FEMA and the regulations concerning the issuance of shares to foreign investors.

Furthermore, the investigation disclosed that BPTP diverted approximately ₹320 crore of the foreign investment received from CPI India L Limited into fixed deposits and mutual funds instead of utilizing the funds for its projects, as stipulated in the investment agreements. This was also recorded as a separate violation under FEMA.