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2017 (10) TMI 1129

Head Note:
Investigation and enquiry into violation of FEMA and the Rules and Regulations - Held that:- Any investigation undertaken with an intention to unearth violations of provisions of FEMA cannot be characterized as motivated or malicious merely because before initiation of such proceeding, an award had been passed against the Central Government regarding alleged breach of contract entered into between the Government and the Company. Alleged breach of contract is one thing and violation of FEMA is totally another thing. This Court cannot interfere in the matter to stall the investigation and enquiry by the adjudicating authority. In such matters all such allegations can be pleaded, demonstrated and proved by way of reply to show cause notice. Prima facie I am of the view that such bare allegations cannot form basis for stalling investigation and enquiry into violation of FEMA and the Rules and Regulations framed thereunder.

As rightly contended by learned Additional Solicitor General hapter V of FEMA read with Rules framed, provides a complete network of provisions adequately structuring rights and remedies available to a person who is aggrieved by any adjudication under FEMA. In the instant case once a reply is submitted to the show cause notice, the adjudicating authority may take a decision to proceed in the matter or not to proceed. In case it decides to proceed, full opportunity will have to be provided to petitioners. If it is found that petitioners were guilty, then there is a provision to appeal to the Appellate Tribunal. If any person is aggrieved by any decision or order of the Appellate Tribunal, he may file an appeal to the High court.

Thus, it is clear that the Act and the rules framed provide sufficient mechanism for redressing the grievance of petitioners. In such circumstances, merely on the basis of certain allegations of malafides, this Court cannot entertain the writ petition to quash the show cause notice or the complaint exercising jurisdiction under Article 227. It will tantamount to preventing investigation and enquiry into violations of serious nature which may affect the economic fabric of the Country. Truth will, in anyway, ultimately emerge.

Therefore, keeping open all contentions of petitioners and reserving liberty to them to avail the remedies provided under the provisions of the Act read with the Rules and Regulations framed thereunder, these writ petitions are dismissed.

 

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