Overview

• The Karnataka High Court directed Google India and three senior executives to deposit 50% of penalties as bank guarantees within two weeks.
• The penalties, totaling Rs 5.45 crore, stem from alleged violations of the Foreign Exchange Management Act (FEMA) involving Rs 364 crore in disputed cross-border transactions.
• The Enforcement Directorate (ED) classified the transactions as commercial loans requiring prior Reserve Bank of India (RBI) approval, which Google India contests.
• Google India argues the transactions were not foreign exchange borrowings and complied with RBI guidelines, citing no loan agreements, deferred payments, or interest.
• The court overruled a 2019 tribunal stay on penalties, emphasizing the preliminary nature of the earlier decision.