9911796707
TMI Blog2024 (8) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... is the branch of defendant no. 1 in Defence Colony, New Delhi wherein the plaintiffs opened their bank accounts with the defendant bank. Factual Background 3. The case as set out by the plaintiffs in a nutshell is that that the plaintiffs opened a Savings Bank Account with the defendant bank under the Non-Resident External Account ('NRE Account') bearing no. 6523 in March of 1990 at the Defence Colony Branch, New Delhi. The plaintiffs opened the same after completing of all the necessary formalities including submission of the Account Opening Form and Specimen Signature Card. 4. The plaintiffs deposited Rs. 4,00,00,000/- (Four Crore Rupees) from their Moscow office account on 28th March 1990 in the said NRE Account. The account was originally opened by plaintiff no. 2 as a Non-Resident Indian, however since she subsequently changed her residential status, she is said to have ceased to be a joint signatory in the said NRE Account. 5. It is stated that in the absence of plaintiff No. 1 from Delhi, plaintiff no. 2 on 23.04.1990 received a note from the then Branch Manager of defendant no. 2 requesting a blank cheque (only bearing signature of plaintiff no. 2) on urgent basis. 6. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,00,00,000/- to the account of the Plaintiffs. 13. Since the amounts were not refunded, the present suit was filed. 14. The defendant bank in their written statement have denied the averments made by the plaintiffs and stated that the suit is barred by limitation. It is further stated that the plaintiff had earlier filed a claim petition before the National Consumer Disputes Redressal Commission bearing Original Petition No. 150 of 1992 on the same cause of action which was dismissed on 19.03.1993. There are contradictory pleas raised in the present plaint. 15. The defendant bank state that the change of residential status of the plaintiff no. 2 was never conveyed to them. They deny that the then Branch Manager of defendant no. 2 requested blank cheques from the plaintiff no. 2, rather it is alleged that that the plaintiff no. 2 issued a cheque bearing no. 432283 dated 23.04.1990 for an amount of Rs. 2 crore on 'yourself' with instructions on the back on the cheque to the defendant bank to "please issue a telegraphic transfer on your Hyderabad Branch (Bank St.) favoring Asian Wire Ropes Ltd." Simultaneously, a telex message was received from the plaintiff no. 1 dated 23.04.199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is hit by the provisions of Foreign Exchange Regulation Act? If so, to what extent? vii. To what amount, if any, is the plaintiff entitled? viii. Whether the plaintiff is entitled to interest? If so, at what rate and for what period? ix. Relief. Evidence led by the parties 19. The plaintiffs examined the following witnesses: a. PW1: Shri Mohan Murti Shandilya (Plaintiff no. 1) tendered his evidence by way of affidavit, i.e. Ex. PW1/1, and was cross-examined. b. PW2-Mrs. Renu Murti Shandilya tendered her evidence by way of an affidavit, i.e. Ex. PW2/1. Since she executed a Special Power of Attorney in favor of her husband, PW1 tendered his affidavit on her behalf, i.e. EXH PW 2/A. PW2 did not enter the witness box for being cross-examined. 20. The defendant bank examined the following witnesses: i. DW1: Sh. Rajeev Shetty, (then Branch Manager of the defendant bank) tendered his evidence by way of affidavit and relied upon the following documents: a. Exhibit PW1/D5: The Original letter dated 14.10.1989 by M/s. Gambro Nexim (India) Medical Ltd. b. Exhibit PW1/D4: The Original abstract of the Resolution dated 14.10.1989 passed by the Board of M/s. Gambro Nexim (India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an Wire Ropes Ltd. signed by the Plaintiff No. 1. t. Exhibit PW1/D70: Original letter dated 26.09.1990 by Plaintiff No. 2 u. Exhibit PW 1/D62: Extracts of the minutes of meeting dated 18.02.1991. v. Exhibit PW 1/D1: Petition filed by the Plaintiff No. 1 in NCDRC. w. Exhibit PW1/D49, Exhibit PW 1/D50; Exhibit PW 1/D51; Exhibit PW 1/D52; Exhibit PW1/D53; Exhibit PW 1/D54; Exhibit PW 1/D55; Exhibit PW 1/D 58; Exhibit PW 1/D 59; Exhibit PW 1/D60: Original Cheques from three account numbers. x. Exhibit PW1/D64: letter dated 20.02.1992, 27.04.1992 and dated 13.07.1992 sent by DW1. ii. DW2: Shri Achyuth Kunjathaya, (then Assistant Branch Manager of the defendant bank) tendered his evidence by way of affidavit and relied on the same documents as DW1. iii. DW3: Mr. Sreedhar Rai, Chief Manager, Hyderabad Branch tendered his evidence by way of affidavit. However, vide order dated 27.04.2013, the defendant bank submitted before the learned Joint Registrar that the defendant bank do not wish to examine DW3 and dropped him as a witness. iv. DW-4: Mr. M. Janakiram, Chairman and Managing Director of M/s. Asian Wires Ropes Ltd. tendered his evidence by way of an affidavit. However vide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of which such fee is payable, shall have the same force and effect as if such fee had been paid in the first instance." 27. Under section 149 of CPC, the courts have been granted the discretion to permit receiving the deficit court fee at any stage, even in the absence of an application praying for the same, subject to the said discretion being exercised equitably. 28. The plaintiff has cured the defect of deficit court fee within 30 days of the objections. A minor delay in payment of balance court fee cannot act as an impediment in entertaining the suit filed by the plaintiff. 29. Hence, the present suit is held maintainable and within the period of limitation. Issue No. III: When did plaintiff No. 2 change her status from non-resident Indian to resident Indian and whether an intimation thereof was given to the bank? If so, on which date? 30. The plaintiff submits that it is at the insistence of defendant bank that the plaintiff No. 2 had to change her NRI status to that of a resident Indian on 17.04.1990 by filing an affidavit to that effect and delivering a certified true copy of the same to the defendant bank on the same date because the plaintiff No. 2 was informed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Mr. Rajiv Shetty, the then Chief Manager/Sr. Manager of defendant Bank, by insisting that she has to submit an Affidavit stating that she has changed her status from NRI to Resident Indian in order to purchase Real Estate in India. Ques. 10: I suggest to your that at the time which you allege that Mr. Shetty or defendant took the document from plaintiff No. 2 you were personally not present. Ans.: I do not remember. Ques. 11: I suggest to you that at the time when you allege that the Bank retained the aforesaid document you were personally not present? Ans.: I do not remember. Ques. 12: Are you carrying the copy of Affidavit of plaintiff No. 2. That you claimed you delivered to the Bank? Ans.: I undertake to make an effort to locate the one if available." 32. The defendants submits that no information of change in residential status of plaintiff no. 2 was ever brought to the knowledge of the defendant bank. No request for withdrawal/removal as signatory was ever made by either of the plaintiffs, which is the obligation of the plaintiffs towards the defendant bank. Rather, the plaintiff no. 2 has continued to issue cheques from the NRE Account no. 6523 clearly showi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17.04.1990, the plaintiff No. 2 ceased to be an NRI. There is no evidence on record to show that the defendant bank was duly informed by the plaintiff no. 2.The NRE Account Opening Form, i.e. PW1/D44, clearly casts an obligation upon the plaintiffs the duty to inform the defendant bank a change in their residential status. The operative portion of PW1/D44 reads as under:- "A set of specimen signatures duly authenticated by a Bank Indian Embassy/Notary public /person known to your bank is furnished below for your records. I/We hereby undertake to intimate to you about my/our return to India on coming back to India for permanent residence." 36. Even if it is assumed that there had been a change, the plaintiff no. 2 continued to issue cheques from the same account, i.e. (Ex. PW1/D58) cheque dated 07.05.1990 for Rs. 1,00,00,000/- issued from NRE Account No. 6523 to create a Fixed Deposit with the Defence colony branch, i.e.(Ex PW1/D68). The said transaction shows that the plaintiff no. 2 continued to issue cheques in the capacity of a joint account holder and continued to sign from the NRE account. 37. Therefore, in the absence of any material evidence being on record to show that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... like the loan on a promissory note: "the nature and gravity of an issue necessarily determines the manner of attaining reasonable satisfaction of the truth of the issue; or as said by Lord Denning, "the degree of probability depends on the subject-matter. In proportion as the offence is grave, so ought the proof to be clear". But whether the issue is one of cruelty or of a loan on a pronote, the test to apply is whether on a preponderance of probabilities the relevant fact is proved. In civil cases this, normally, is the standard of proof to apply for finding whether the burden of proof is discharged." 40. To my mind, both parties have been unable to give clear and clinching evidence in support of their case therefore the issues are being decided on preponderance of probabilities as well as on discharge of onus of proof. The Hon'ble Supreme Court in Rangammal v. Kuppuswami, (2011) 12 SCC 220 held as under:- "21. ...... Thus, the Evidence Act has clearly laid down that the burden of proving a fact always lies upon the person who asserts it. Until such burden is discharged, the other party is not required to be called upon to prove his case. The court has to examine as to wheth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plaintiff is violative of the provisions of FERA Act, 1974 and tantamount to providing wilful deficiency services to the Plaintiff. The defendant Bank is further guilty of non compliance with the mandatory provisions of Banking Rules and Practice and the guidelines laid down by the Reserve Bank of India and have failed to adhere to the provisions of the Banking Regulation Act, 1949. The defendant bank is also, therefore, guilty of not providing honest and clean services to its customers and is bound to refund the sum of Rs. 2,00,00,000/- together with interest and other charges accrued thereon to the plaintiffs, wrongly and willfully misappropriated and transferred from the plaintiffs account, as mentioned above. .... 15. That the plaintiff submits that on account of unauthorised misappropriation of the above said sum of Rs. 2,00,00,000/- from the account of the plaintiff, the plaintiffs have suffered a huge loss and damages for the past about 3 years, which they would have otherwise utilised in connection with and expansion of their business activities. Without prejudice to the plaintiffs right to claim such other and further damages as they may be entitled to for the various ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... int 'A' has been asked to identify the signature of the person on it. Ans.: The document is also not on record of the case file and is irrelevant, rather misleading since it relates to an account which is different man the one which the suit for recovery has been filed by the plaintiff's against the defendant's. Que.: The defendant counsel has reiterated the question. Ans.: It is irrelevant and misleading, in as much as the defendant's have fabricated the specimen signature cards of my wife's Indian Rupee accounts No. 6524, original of which have not been produced till date in any proceedings initiated against the defendant's and had been filed in the present proceedings after interpositions of the words "Defence Colony" and "NRE 6523" as the original on 11.1.1996 at page No.4 of the said list. The photocopy of the same filed by the defendant's on 1.2.94 does not match with this original being absolutely blank in two relevant column meant for the Branch name and the account no. Ans.: The signatures appearing at point encircled 'A' on Ex.PW1/D4 appears to be similar to that of plaintiff 2." ... 16.08.2005 Ques. 11: Was any statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecting house wife in the absence of her husband." 46. The plaintiff has also placed reliance on the RTI reply dated 13.08.1999 wherein the RBI has categorically stated that the funds can be transferred from an NRE account only when signature on the cheque tally with the signature received in the Specimen Signature Card. Further, RBI also stated that there cannot be more than one Specimen Signature card of a NRE Account at one point of time. The queries dated 22.08.1998 raised by the plaintiffs and the RTI reply dated 13.08.1999 by the Reserve Bank of India is reproduced respectively as under:- 22.8.1998 to Exchange Control Department of Reserve Bank of India (ECD-RBI): Would you please be so kind as to inform me whether 1. funds can be transferred from an NRE account on the basis of a cheque carrying signatures different from the signature as recorded in the Specimen Signature Card of that NRE account? 2. Can there be more than one Specimen Signature Card of a NRE account? 3. Is it necessary that the signature on the Specimen Signature Card belonging to a NRE account must match Wiff the signature on the passport of the NRI account in whose the said NRE account is open ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 with a request to open two accounts, one being a Non-Resident External (NRE) Savings Bank Account in their joint names and another ordinary Savings Bank Account in the individual name of the Plaintiff No. 2.The Plaintiff No. 1 signed the NRE Account Opening form, i.e. PW1/D44, under the signatures "Mohan Murti" i.e. PW1/D36and the Plaintiff No. 2 signed the same as "R. Shandilya," i.e. PW1/D35. It is submitted that the Plaintiff No. 2 herself stated that she generally issues Cheque under the signatures "R. Murti", as such, in respect of the NRE Account, she would sign another Specimen Signature Card form, i.e. PW1/D37, with the signature "R. Murti". Considering, the request of the Plaintiff No. 2, another Specimen Signature Card form was given to the Plaintiff No. 2 which she signed under "R. Murti". 51. DW1 in this regard has deposed as under:- 18.07.2007 "Q.6: Were the account Nos. of the said specimen signature cards and account opening forms filled in after the account holder left your bank? Ans.: No necessarily. Q.7: Question No.6 is again repeated with emphasis on seeking an exact answer on fact, whether the account Nos. were filled in, as stated in the forgoing q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levelled by the Plaintiffs, stating that the official of the defendant bank had fraudulently got a blank cheque issued from the Plaintiff No. 2 is baseless, sham and bogus. The Plaintiff No. 2 had issued cheque amounting to Rs. 2 Crores so as to facilitate the takeover of the Companies namely M/s. Asian Wires Ropes Ltd. and M/s. Asian Ispat Pvt. Ltd. It is stated that the Defendant Bank has never imposed the liabilities of M/s Asian Wire Ropes Ltd. on the Plaintiffs and the Plaintiffs have willfully and consciously undertaken the aforesaid transaction. 55. DW1 has deposed the following in this regard:- 01.11.2007 "Que. 14: Did Mrs. Renu Murthy tell you me the alleged telephone call the mandate which you have mentioned she has said is given on the cheque? Ans.: On 23.4.90, when plaintiff No. 2 called up, she had given the clear mandate on the reverse of the cheque and requested me to do the needful as per the mandate given on the reverse of the cheque. Que. 15: Did she read out the mandate? Ans.: No she did not read out the mandate. Vol. On 23.4.90 she told me on phone that money is to be transferred telegraphically to Hydrabad favouring Asian Wire Ropes Ltd. today itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs nor Directors or guarantors. iii. In para 3(h) it is stated that when the amount of Rs. 2 Crore was not refunded, by the bank, the complainant was forced to take the shares in aforesaid companies and he started looking after their affairs. In paragraph 13 it is stated that the liabilities of the above said two companies were imposed on the plaintiff no. 1 and thereafter the amount of Rs. 2 Crore was adjusted/transferred from the NRE account. iv. In para 3(i) it is stated that the complainant with his hard labour and involvement of Rs. 2 Crore made substantial progress in realizing the dues of Asian Wire Ropes Ltd. but after retirement of Sh. Sadanand Shetty the operation of the accounts of aforesaid companies were stopped by the bank. No such averment. v. In paragraph 4 it is stated that Sh. Sadanand Shetty had supressed the factum of pendency of criminal proceedings before Directorate of Revenue Intelligence, Bombay in respect of violations of Customs Act, Imports and Exports (Control) Act, etc. committed by the said company and he took the plaintiff no. 1 in his web to save his own skin. No such averment. vi. In paragraph 5 and 6 it is stated that the compla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subsidiary Asian Steel Pvt. Ltd.. The plaintiffs have even opened a bank account in the name of M/s. Asian Wire Ropes Ltd (Ex. PW1/D10) with the defendant bank, showing active involvement of the plaintiffs with M/s. Asian Wire Ropes Ltd. The account opening form duly exhibited as Ex. PW1/D10 is reproduced below:- 60. On preponderance of probabilities, it cannot be ruled out with certainty that in lieu of the proposed business relationship, the plaintiffs had partaken in the alleged transaction. 61. Even otherwise, the plaintiffs have relied on two grounds to prove its case that the encashing of the cheque in question was illegal, improper and unauthorised (a) the plaintiff No. 2 signed as "R. Shandilya" in the Account Opening Form (Ex. PW1/D10) and Signature Specimen Card (Ex. PW1/D35) of NRE account No. 6523 and that the cheque in question carried the signature as "R. Murti." and (b) only one Specimen Signature Card for an account can exist in accordance with the RTI reply dated 13.08.1999 by the Reserve Bank of India. 62. There may be merit in the plaintiffs submission that a cheque enchased in contravention of the Account Opening Form and the Specimen Signature Card of the NR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under:- "12. The object and purpose of pleadings and issues is to ensure that the litigants come to trial with all issues clearly defined and to prevent cases being expanded or grounds being shifted during trial. Its object is also to ensure that each side is fully alive to the questions that are likely to be raised or considered so that they may have an opportunity of placing the relevant evidence appropriate to the issues before the court for its consideration. This Court has repeatedly held that the pleadings are meant to give to each side intimation of the case of the other so that it may be met, to enable courts to determine what is really at issue between the parties, and to prevent any deviation from the course which litigation on particular causes must take. 13. The object of issues is to identify from the pleadings the questions or points required to be decided by the courts so as to enable parties to let in evidence thereon. When the facts necessary to make out a particular claim, or to seek a particular relief, are not found in the plaint, the court cannot focus the attention of the parties, or its own attention on that claim or relief, by framing an appropriate issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e card of any Account at one point of time. However, once again the said averment has only been alleged at the stage of filing of Evidence. Even at the stage of filing of Evidence, the RTI reply dated 13.08.1999 of the Reserve Bank of India has not been specifically relied upon but only a bald statement has been made, i.e. "Even a letter from Reserve Bank of India supports this fact, namely that there cannot be more than one Specimen Signature Card of one person/holder of an account at any given time." 68. The RTI reply of RBI is not proved in accordance with law. The said letter/reply/RTI by the RBI has not been exhibited and the Evidence by way of Affidavit is completely silent on the material particulars of the said RTI reply. No witnesses were examined with regard to the RTI reply and at the time of cross-examination, only general and non-specific questions were put to DW2. The deposition of DW2 in this regard reads as under:- 13.03.2012 "Q. Have you ever issued two specimen signature cards to one customer in one account simultaneously? Ans. 1 do not remember. I do not know about the proceedings going on, if any, in the Economic Offences Wing against the Bank. When pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nied for want of knowledge that the plaintiff No. 1, had gone abroad in April, 1990. It is further stated that the plaintiff No. 1 had sent a telex on 23.4.1990 from Hyderabad to the plaintiff bank. It is specifically denied that the defendant no. 2 sent any note to the plaintiff No. 2 requesting her to send blank cheques. It is denied that any communication was sent to plaintiff No. 2 that any blank cheque was required by the branch officials. The allegation is totally false and incorrect and is sought to be made to evade the liability of the plaintiff to the defendant bank. It is further inconceivable that the plaintiffs including plaintiff no. 2 would send any blank cheque being businessmen who alleged that they had come to India for carrying on the business. The correct facts are that defendant No. 2 issued a cheque bearing no. 432283 dated 23.4.1990 for an amount of. Rs. 2 crores on 'yourself' with instructions at the back to "please issue a telegraphic transfer on your Hyderabad Branch (Bank St.) favouring Asian Wire Ropes Ltd." Simultaneously, a telex message was received from the plaintiff No. 1 dated 23.4.1990 stating that the formalities for taking over of Asian W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above are those encircled at points B and Bl on Ex.PW1/D-31. Is that correct? Ans.: Yes. As repeatedly earlier, the said signatures were obtained fraudulently by defendant Bank through its officials, namely Shri. Rajiv Sethi and Ors. .... 06.01.2006 Ques. 1: Please look at point encircled 'B' on Ex.PW1/D-25 and answer whether it is your position that the sum mentioned as encircled at point 'B' is the amount that is referred to in Ex.PW1/D-31? Ans.: NO." 74. Relevant cross-examination of DW1 and DW2 reads as under:- Cross-examination of DW1 on 12.09.2007 "Que. 20: Can you pass a cheque on the basis of a signature placed by the account holder on the account opening form? Ans.: Normally we obtain invariably specimen signature card while opening the accounts. In case the specimen card of the particular account holder is not available on record we immediately obtain another fresh specimen card for that particular account. However, in the mean while, we pass cheques based on the specimen signature available on the account opening form. Que. 21: Did you pass the cheque of Rs. 2 crores, which is Ex. No. PW1/D-31 on the basis of signatures of account hol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcled as "Q-1". Do you know, in whose handwriting is this portion i.e. "Q-1"? A. I do not know. Q. Do you know at what stage, the word "Q-1" was marked on the reverse of the document Ex. PW1/D-31? A. I do not know. I have gone through the record of this case before agreeing to appear as a witness. I had seen the document Ex. PW1/D-46 in the Branch file. I was not posted in Defence Colony Branch of the Bank 16.11.1995, which is the date of this document Ex. PW1/D-46. I am not aware as to on which date Mr. Rajiv Shetty was arrested. ... 13.03.2012 Q. It is put to you that by issuing two specimen signature cards to plaintiff No. 2 simultaneously the bank has acted in direct derogation of the mandatory RBI guidelines pertaining to account opening. What do you have to say? (Ld. counsel for defendant has objected to the question on the ground that it is vague). Ans. There is no violation. Plaintiff No. 2 had mentioned on the back of cheque Ex.PW1/D31 that "please issue a telegraphic transfer on your Hyderabad Branch (Bank Street) favouring Asian Wires Ropes Ltd." and it was signed by her. Plaintiff No. 2 did not sign in my presence. I do not know if the writing on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture Cards signed as "R. Murti" brought on record by the defendant bank before court. They are reproduced and encircled, to show that the account numbers are written at different places on the Specimen Signature Cards, as under:- i. EX. PW1/D37: (No Branch Name given and No Account Number) ii. EX.PW1/D33: (Branch Name Given and Account Number Given) iii. DW1/A24 'a' (No Branch name written but Account Number written) 80. The question is whether the above three circumstances discharge the onus of proof on the plaintiffs in order to allow issues II, IV and V? 81. There is no doubt that a bank cannot be callous or deal with its customers in a causal manner. The defendant bank does not have a Specimen Signature Card for Saving Bank Account bearing No. 6524, wherein as per the plaintiff no. 2 she signed as "R Murti". The defendant bank has two Specimen Signature Cards for NRE Account No. 6523 alongwith multiple photocopies of the Specimen Signature Card NRE Account no. 6523 for absolutely no reason or explanation. The defendant bank may have personal equations with clients but they are bound to follow the procedure and mandate of law. If a Specimen Signature Card is missing (whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.04.1990 were admittedly done in Indian Rupees, at Hyderabad, therefore, the provisions of said Act, particularly section 8 thereof, are not attracted in this case. 89. Section 8 of the FERA, 1973, reads as under:- "Section 8 - Restrictions on dealing in foreign exchange (1) Except with the previous general or special permission of the Reserve Bank, no person other than an authorised dealer shall in India, and no person resident in India other than an authorised dealer shall outside India, purchase or otherwise acquire or borrow from, or sell, or otherwise transfer or lend to or exchange with, any person not being an authorised dealer, any foreign exchange: Provided that nothing in this sub-section shall apply to any purchase or sale of foreign currency effected in India between any person and a money-changer. Explanation. For the purposes of this sub-section, a person, who deposits foreign exchange with another person or opens an account in foreign exchange with another person, shall be deemed to lend foreign exchange to such other person. (2) Except with the previous general or special permission of the Reserve Bank, no person, whether an authorised dealer or a money- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , inquiry, trial and appeal. It is a self-contained code, including statutory functionaries specifically and specially constituted to inquire and adjudicate upon any contraventions, as alleged. The provisions under FERA empowers the Directorate of Enforcement and its officers to search, recover, arrest, hold trial for offences and impose punishment for offence under the Act. 92. Furthermore, the proceedings under FERA are quasi-criminal in nature. The courts have held that the power to adjudge any contravention alleged under the act would lie with Directorate of Enforcement in the first instance. The judgement of the Hon'ble Supreme Court in Shanti Prasad Jain v. Director of Enforcement, FERA, 1962 SCC OnLine SC 167 has held as under:- "6. It will be seen that when there is a contravention of Section 4(1), action with respect to it is to be taken in the first instance by the Director of Enforcement. He may either adjudge the matter himself in accordance with Section 23 (1) (a), or he may send it on to a court if he considers that a more severe penalty than he can impose is called for. Now the contention of the appellant is that when the case is transferred to a court, it will be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and a serious offence should not go without being adequately punished by reason of cognizance thereof having been taken by an inferior authority, the accused should on the other hand have in such cases the benefit of a trial by a superior court. That is the principle underlying Section 349 of the Criminal Procedure Code, under which Magistrates of the Second and Third Class, are empowered to send the cases for trial to the District Magistrate or Sub-Divisional Magistrate, when they consider that a more severe punishment than they can inflict is called for. In our view the power conferred on the Director of Enforcement under Section 23-D to transfer cases to a court is not unguided or arbitrary, and does not offend Article 14 and Section 23 (1) (a) cannot be assailed as unconstitutional. 93. In view of the above, no complaint has been filed to FERA. The plaintiffs have also failed to show how the provisions under FERA will be applicable against the defendant bank. 94. For the above said reasons, in these circumstances, the issue no. VI is decided against the plaintiffs. Issue No. VII, VIII and IX 95. Issue No. VII, VIII and IX are inter-connected and therefore I shall be dealing ..... 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