TMI Blog2015 (1) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... the Rules. Further, the petitioners were directed to appear either in person or through their Legal Practitioners/Chartered Accountants duly authorised by them to explain and produce such documents as may be useful or relevant to the subject matter of enquiry. There is nothing to indicate that the adjudicating authority has straight away proceeded to the stage contemplated under sub rule (4) of Rule 4. The show cause notice does not indicate any such conclusion nor it may be stated that the respondent has violated the procedure under Rule 4 of the Rules. In fact, the attention of the petitioners has been drawn to Rule 4 of the Rules. Therefore, the plea raised by the petitioner that the show cause notice is vitiated for having not following the procedure under Rule 4 of the Rules, deserves to be rejected. - Decided against the petitioner. - W. P. No. 18857 of 2010 - - - Dated:- 9-12-2014 - T. S. Sivagnanam,JJ. For the Petitioner : Mr. B. Kumar, Sr. Counsel for Mr. R. Loganathan For the Respondent : Mr. M. Dhandapani ORDER The petitioners have filed this Writ Petition praying for issuance of a writ of certiorari to quash the proceedings issued by the respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow cause notice. On reply being given by the noticee, the adjudicating authority in terms of Sub Rule 3 of Rule 4 of the Rules has to form an opinion whether the enquiry should be held or not, he may also accept the reply and drop the proceedings. Further such opinion must be in writing and without recording opinion, the adjudicating authority is not entitled to proceed to the next stage. 6. Further it is submitted that in terms of the decision of the Bombay High Court in the case of SHASHANK VYANKATESH MANOHAR v. UNION OF INDIA [MANU/MH/1132/2013], if the noticee wants to be informed of the reasons to be recorded, it should be furnished and the next stage of the proceedings to hold an enquiry can be done only after fifteen days, after communicating the reasons for forming such opinion. 7. The learned counsel submitted that in the instant case, the adjudicating authority has not adhered to the two tyre procedure contemplated under the Rules and therefore the entire adjudication proceedings commencing from the show cause notice is vitiated. Further, by referring to Sub Rule (6) of Rule 4, it is submitted that right of leading evidence is indispensable part of natural justice a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t that the Rules do not provide and empower the adjudicating authority to straight away make any enquiry into the allegations of contravention against any person against whom a complaint has been received. 10. Further,the concept of fairness may require the adjudicating authority to furnish the copies of those documents upon which reliance has been placed by him to issue show cause notice requiring the noticee to explain as to why an enquiry under section 16 of FEMA should not be initiated. Further, the principles of natural justice and concept of fairness are required to be read in accordance with Rule 4(1) of the Rules and fair procedure and principles of natural justice are inbuilt into the Rules. Therefore, it is submitted that the impugned proceedings are illegal and liable to be set aside. 11. Mr.M.Dhandani, learned counsel for the respondent submitted that the Writ Petition is premature as the same has been filed at the show cause notice stage and the petitioners have not given final reply to the show cause notice instead they have chosen to question the legality of the interlocutory order. In this regard, reliance has been placed on the decision in the case of SPECIAL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions with regard to machinery for contravention of the provisions of the Act, the enforcement of the orders passed by the adjudicating authority and the manner in which the proceedings should be conducted by the adjudicating authority. The Act is a self contained code dealing with all the aspects of the matter. While interpreting a provision of a special statute like FEMA, the nature of proceedings should also be taken into account by the Court. 15. The complaint produced certain materials before the adjudicating authority to initiate adjudication proceeding. The adjudicating authority has in turn provided all such materials to the petitioner to submit his explanation. It is for the petitioner to submit his explanation with regard to the circumstances pointed out against him. The attempt of the petitioner appears to be to collect materials after cross examining the witnesses and to file an additional reply to escape from the clutches of law. The petitioner has denied the allegations in a vague manner. The intention of the petitioner is very clear. He is not prepared to disclose his defence and he wanted to make out a case after cross examination. The materials now produced by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a reply to a charge memo in a disciplinary proceeding. Therefore, I do not think that there is any scope for expanding Rule 4(3) to mean that the forming of the opinion as required in Rule 4(3) has to be reflected by an order in writing containing reasons. The interpretation given by the Division Bench of the Bombay High Court to the expression opinion appears to be very elastic. 16. The learned counsel appearing for the respondent submitted that the petitioner has approached this Court as the very threshhold and the proceedings are still in the stage of Rule4(1) of the Rules. In terms of Rule 4 (1) of the Rules, for the purpose of adjudicating under section 13 of the Act, whether any person has committed any contravention as specified in section 13 of the Act, the adjudicating authority shall issue a notice to such person requiring him to show cause within such period as may be specified in the notice, why an enquiry should not be held against him. Though the petitioner would state that they have given a reply to the show cause notice, but it is only a request for cross examination and for furnishing certain details, which the authority has rejected. 17. As pointed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laint, which was enclosed along with the show cause notice. The attention of the petitioners was invited to Rule 4 of the Rules. Further, the petitioners were directed to appear either in person or through their Legal Practitioners/Chartered Accountants duly authorised by them to explain and produce such documents as may be useful or relevant to the subject matter of enquiry. There is nothing to indicate that the adjudicating authority has straight away proceeded to the stage contemplated under sub rule (4) of Rule 4. The show cause notice does not indicate any such conclusion nor it may be stated that the respondent has violated the procedure under Rule 4 of the Rules. In fact, the attention of the petitioners has been drawn to Rule 4 of the Rules. Therefore, the plea raised by the petitioner that the show cause notice is vitiated for having not following the procedure under Rule 4 of the Rules, deserves to be rejected. 21.In the result, the Writ Petition fails and it is dismissed. Petitioners are directed to submit their reply to the show cause notice dated 28.5.2009, within a period of thirty days from the date of receipt of a copy of this order. No costs. Miscellaneous Petit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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