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2015 (4) TMI 1327 - HC - FEMAViolation of the provisions of FEMA - penalty u/s 13 (1) of FEMA imposed - freezing the bank account as exercised by Assistant Director under Section 37 (3) of FEMA - HELD THAT:- The above provision empowers the Assistant Director to exercise powers under the Income Act 1961. Thus the communication dated 17/11/2014 freezing the petitioners' fixed deposit account in Bank of Baroda is submitted to be in terms of Section 132 (3) of the Income Tax Act 1961. However, in terms of Sections 132 (8) of the Income Tax Act 1961 the life of such a freezing order is only 60 days. Admittedly, the period of 60 days have long expired after the communication dated 17/11/2014. Mr. Vaze, learned counsel for the Enforcement Directorate is not able to show any extension granted or any other communication thereafter freezing the account. Consequently, the communication dated 17/11/2014 is no longer valid in law and the same is quashed and set side. For the purpose of this petition we have not examined the larger issue viz. the scope of Section 37 of FEMA and its applicability even after the show cause notice has been issued by the Adjudicating Authority. We do not interfere with the show cause notice dated 18/12/2014. However, the Adjudicating Authority shall dispose of the show cause noticed dated 18/12/2014 as expeditiously as possible after following the principles of Natural Justice.
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