Intimation Under Reg 30 of SEBI (LODR) Regulations, 2015
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Paul Merchants Ltd has received an order dated October 6, 2025 from the Directorate of Enforcement, New Delhi, imposing a cautionary monetary penalty of Rs. 5 lakh under Section 13(1) of the Foreign Exchange Management Act (FEMA), 1999. The penalty relates to alleged violation of Section 10(5) of FEMA read with RBI's KYC Master Direction dated February 25, 2016, concerning inadequate due diligence and KYC compliance in certain remittance transactions done for tour operators and travellers. This follows an earlier show cause notice from February 2024 and a separate RBI adjudication under Section 11(3) of FEMA in January 2025. The company has stated that apart from the Rs. 5 lakh penalty, there is no other material financial or operational impact.
The financial impact is minimal at just Rs. 5 lakh, but the order adds to the company's regulatory compliance overhang under FEMA. Shareholders should note this is a cautionary penalty and the company does not foresee any material business disruption.