TMI Blog2013 (8) TMI 511X X X X Extracts X X X X X X X X Extracts X X X X ..... rounding circumstances - it cannot be said that the respondents had not, correctly, concluded that the petitioner intended to stay in India for an uncertain period and thus, consequently, fell within the rigour of Section 2(p)(ii)(c) of FERA - Regulation A.15 of the Foreign Exchange Manual would be applicable to the petitioner. - WP (C) No. 3760 of 1995 - - - Dated:- 7-2-2013 - RAJIV SHAKDHER , JJ. For the Appellant : P. Ramesh Kumar and Bharat Sood. For the Respondent : Saqib, Kuldeep S. Parihar, H.S. Parihar, Tanu Priya Gupta and Mukesh Verma. ORDER:- CM NO. 1437/2013 (Condonation of delay in filing a rejoinder) and CM NO. 9214/2012 (For Restoration) This writ petition was admitted by a Division Bench of this court on 05.12.1995. Due to persistent non-appearance of the petitioner, the writ petition was dismissed in default on 12.10.2006. By order dated 28.05.2007, the writ petition was restored to its original number on an application being moved by the petitioner in that behalf. 2. It appears that the petitioner was once again not present when the matter came up for hearing on 22.04.2009. In the interest of justice, adverse orders were deferred. Since th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The captioned application is for condonation of delay in filing the rejoinder. The delay is of 76 days. For the reasons given therein, the application is allowed and rejoinder is taken on record. WP(C) 3760/1995 10. Shorn of verbiage, the short issue which arises for consideration is whether the petitioner, who returned to India on 26.01.1988, after six (6) years from Saudi Arabia, ought to have been granted the same facilities qua his bank accounts maintained with respondent no. 4, i.e., State bank of India (SBI), which are available to a Non-Resident Indian (NRI). 11. The petitioner, evidently had proceeded to Saudi Arabia, on a work assignment. It is claimed by him that, due to recession and drastic scaling down of salaries, he decided to visit India with the sole intention of exploring the possibility of taking up a job or a vocation in India. 12. While the petitioner was in Saudi Arabia, he had invested, apparently in shares/debentures floated by Indian companies, through the Bombay (now Mumbai) main branch of SBI under its Non-Respondent Portfolio Investment Scheme. It is the case of the petitioner that, the said investment was made on the basis that he would be abl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1988. These letters are also not on record, though there is a reference to the same in the list of dates. It also appears that, the petitioner held a meeting on 28.11.1988, with the concerned officer of SBI, when the issue of his status i.e., whether he should be regarded as a NRI or a resident, came up; at which point in time he was apparently informed that, since he had taken transfer of residence, the petitioner could not continue to retain a status of a NRI. 16.1 The reference to the meeting of 28.11.1988 is found, in SBI's letter of 02.01.1999. By this letter, the petitioner was informed that, after he had become a resident, he was not allowed to keep a 'Non-Resident External Account' (in short NRE Account) as per the then prevailing provisions of para 29A-15 of the Exchange Control Manual (1987 Edition, Volume 1) [in short EC Manual]. 16.2 Thus, in terms, the petitioner was told that his 'NRE account' would have to be re-designated as a 'Resident Account'. The petitioner was further informed that the facilities which were made available to him as a NRI would not be made available any longer and that if he was desirous of continuing his Resident Account with it, he would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o that of a resident was violative of his fundamental rights. 23. The petitioner, apparently, thereafter issued notices under Section 80 of the Code of Civil Procedure, 1908 (in short CPC) to the respondents herein. These notices are dated 10.11.1984 and 28.11.1984. 24. Respondent no.1, through Ministry of Finance, GOI, according to the petitioner, sent its reply on 22.03.1995 whereby, the petitioner was directed to comply with the instructions of RBI, as communicated to him, in letters 04.07.1989, 21.09.1994 and 18.02.1995. 25. The petitioner was evidently not satisfied and therefore, has approached this court by way of the captioned writ petition. 25.1 I may only note that in the list of dates, there is a reference to the fact that prior to the captioned writ petition, a writ petition, was filed on 20.04.1995, which was taken back by the counsel engaged by the petitioner at that point in time, on 24.9.1995, apparently without the petitioner's knowledge. On the petitioner being queried, he stated that the writ petition was dismissed. There is, however, no order available on record as to whether the writ petition filed earlier was listed in court and thereafter dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submission, relied upon the judgment of the Supreme Court in the case of K. Ramullan v. Commissioner of Income Tax,(2000) 8 SCC 246. 28. On the other hand, on behalf of respondent no.4, Ms. Gupta submitted that, the petitioner was holding two accounts with SBI. These were : NRE Account 6384 and NRO Account 684. Besides this, the petitioner had also mandated SBI with authority to purchase shares and debentures of Indian Companies through Stock Exchange under its Non-Resident Portfolio Investment Scheme. For this purpose, SBI had obtained requisite approval from RBI. 28.1 It was further contended that, SBI on receipt of information from the petitioner vide its communication dated 28.03.1988 that he had returned to India, advised him vide letter dated 22.06.1988 to deposit his cheque book and passbook to enable re-designation of his NRE account into NRO account. 28.2 Thereafter, according to the learned counsel for respondent no.4, the petitioner availed of the benefits under the Transfer of Residence Scheme; which was clearly indicative of, the petitioner's intention, to stay in India for a long, though uncertain period. 28.3 The learned counsel submitted that if there was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c) he had attained the status of a Resident in India. 31. Mr. Parihar, who appeared for respondent no.3 relied upon the provisions of the E.C. Manual to support his contention that, when a person who is a Resident outside India returns to India for an indefinite stay, he would be required to close his foreign currency account, if any, maintained by him during his residence abroad and transfer the balances in those accounts to India, within three (3) months of the date of arrival. The said period, could only be extended and that too, in exceptional cases, on permission being granted by RBI. 31.1 Mr. Parihar, further contended that, those Indian Nationals or persons of Indian origin holding foreign passport, who are residing abroad and were desirous of returning to India to secure suitable employment or, explore possibilities of setting up a small scale industrial unit or, for any other exploratory purpose, could be granted, on merits, an exemption from Exchange Control Regulations, which required such a person to surrender his foreign currency balances within three (3) months of his arrival in India. The exemption, if any, would be granted only to those persons, who applied to R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etter dated 05 Feb. 88, I wish to advise you that I have returned to India on 26 Jan. 88 to explore the possibilities of re-settlement. There is also a possibility of leaving for another assignment overseas after elapse of 12 months from the date of arrival as above, if suitable employment is re-located overseas " 32.3 A careful reading of the aforementioned paragraph would show that, while on one hand, the petitioner was wanting to explore the possibilities of resettlement in India, he also wanted to keep open, an opportunity, to leave India for an overseas assignment, within the next twelve (12) months from the date of his arrival. To my mind, if nothing else, uncertainity was writ large in the letter itself. The petitioner did not state that if, he was not able to re-settle in India within the next twelve (12) months, he would leave India. On the contrary he only projected a "possibility" of leaving India within twelve (12) months if, he found a suitable employment overseas. 32.4 Continuing further, since the petitioner had engaged the services of SBI to sell and purchase share and debentures and/or collect dividend and interest thereon, he appears to have approached SBI to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al with BASF (India). 34. It is in the background of such like correspondence, perhaps, that SBI issued the letter dated 02.01.1989, followed by a letter dated 17.07.1989, wherein it reiterated that with the change of status, it had no option but to close the petitioner's NRE and NRO account, and transfer the funds to the savings bank account of the petitioner. As a matter of fact, this very aspect was briefly reiterated in SBI's letter of 11.06.1993. 35. The petitioner, on the other hand, continued to write to various authorities and, did not deem it fit to approach the court till 1995, by which time almost seven (7) years had expired since, the petitioner was informed about the change, in his, status. 36. In the background of these facts, in my view, the respondents are right in contending that under the provisions of Section 2(p)(ii)(c) of FERA, the petitioner's status had to be changed to that of a Resident. For the sake of convenience, the relevant provisions are extracted hereinafter : "..2. Definitions - In this Act, unless the context otherwise requires (a) xxxxxxxxxxxxx xxxxxxxxxxx xxxxxxxxxxxxx (p). "person resident in India" means ..... X X X X Extracts X X X X X X X X Extracts X X X X
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