IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6TH DAY OF OCTOBER, 2017 BEFORE THE HON’BLE MR.JUSTICE B.S.PATIL W.P.No.35188/2016 (GM-RES) c/w W.P.No.35168/2016 (GM-RES), W.P.No.35923/2016 (GM-RES) IN W.P.No.35188/2016:
BETWEEN SHRI D.VENUGOPAL S/O D.V.PRASAD AGED ABOUT 66 YEARS R/A G-02, PALASHA APARTMENTS NO.26, 4TH MAIN, IX CROSS MALLESHWARAM BANGALORE-560 003. ... PETITIONER (By Sri.SAJAN POOVAYYA, SR.COUNSEL FOR Smt.NALINA MAYEGOWDA, ADV.) AND 1. THE ASSISTANT DIRECTOR, DIRECTORATE OF ENFORCEMENT, BANGALORE ZONAL OFFICE, 3RD FLOOR, B BLOCK BMTC BUILDING, SHANTHINAGAR, K H ROAD, BANGALORE-560027.
2. THE SPECIAL DIRECTOR, DIRECTORATE OF ENFORCEMENT, SOUTHERN REGIONAL OFFICE GOVERNMENT OF INDIA MINISTRY OF FINANCE SHASTRIBHAWAN, III BLOCK, III FLOOR 26, HADDOWS ROAD CHENNAI-600 006. ... RESPONDENTS (By Sri K.M.NATARAJ, ASG A/W Sri P.KARUNAKAR, ADV.) IN W.P.No.35168/2016 BETWEEN DEVAS MULTIMEDIA PRIVATE LIMITED, UNIT 502, PRESTIGE MERIDIAN-1, NO.209, M.G.ROAD, BANGALORE 560 001, REP.BY ITS COMPANY SECRETARY-
MR.VINOD SUNDER R. ... PETITIONER (By Sri.UDAYA HOLLA, SR.COUNSEL FOR Sri NANDISH A.PATEL, ADV.) AND 1. THE ASSISTANT DIRECTOR, DIRECTORATE OF ENFORCEMENT, BANGALORE ZONAL OFFICE, 3RD FLOOR, B BLOCK BMTC BUILDING, SHANTHINAGAR, K H ROAD, BANGALORE-560027.
2. THE SPECIAL DIRECTOR, DIRECTORATE OF ENFORCEMENT, SOUTHERN REGIONAL OFFICE GOVERNMENT OF INDIA MINISTRY OF FINANCE SHASTRIBHAWAN, III BLOCK, III FLOOR 26, HADDOWS ROAD CHENNAI-600 006. ... RESPONDENTS (By Sri.K.M.NATARAJ, ASG A/W Sri P.KARUNAKAR, ADV. FOR R1 & R2) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DECLARE THAT THE IMPUGNED PROCEEDINGS INITIATED BY THE RESPONDENTS UNDER FEMA ARE WITHOUT JURISIDICTION; AND TO QUASH THE PURPORTED COMPLAINT DATED 31.05.2016 AT ANNEX-B ISSUED BY R-1; AND TO QUASH THE PUPORTED SHOW CAUSE NOTICE DATED 06.06.2016 AT ANNEX-A ISSUED BY R-2, AND ETC.
IN W.P.No.35923/2016 BETWEEN SHRI M.UMESH S/O K.VENKATARAMANAYYA AGED ABOUT 55 YEARS R/AT 694, 8-B MAIN, VIJAYA BANK COLONY, BILEKHALLI, BANGALORE 560 076. ... PETITIONER (By Sri.SAJAN POOVAYYA, SR.COUNSEL FOR Sri ASHWIN KURIAN, ADV.) AND 1. THE ASSISTANT DIRECTOR, DIRECTORATE OF ENFORCEMENT, BANGALORE ZONAL OFFICE, 3RD FLOOR, B BLOCK BMTC BUILDING, SHANTHINAGAR, K H ROAD, BANGALORE-560027.
2. THE SPECIAL DIRECTOR, DIRECTORATE OF ENFORCEMENT, SOUTHERN REGIONAL OFFICE GOVERNMENT OF INDIA MINISTRY OF FINANCE SHASTRIBHAWAN, III BLOCK, III FLOOR 26, HADDOWS ROAD CHENNAI-600 006. ... RESPONDENTS (By Sri.K.M.NATARAJ, ASG A/W Sri P.KARUNAKAR, ADV.) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DECLARE THAT THE IMPUGNED PROCEEDINGS INITIATED BY THE RESPONDENTS UNDER FEMA ARE WITHOUT JURISIDICTION; AND TO QUASH THE PURPORTED COMPLAINT DATED 31.05.2016 AT ANNEX-B ISSUED BY R-1; AND TO QUASH THE PUPORTED SHOW CAUSE NOTICE DATED 06.06.2016 AT ANNEX-A ISSUED BY R-2, AND ETC.
THESE PETITIONS HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 04.09.2017, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER 1. Petitioner is a company incorporated under the provisions of the Companies Act, 1956. Two other separate writ petitions, one by the present Director of the Company Sri D.Venugopal and another by the Former Director by name Sri M.Umesh have also been filed in W.P.No.35188/2016 and W.P.No.35923/2016 respectively. All these writ petitions have been heard together and are disposed of by this common order as common questions arise for consideration. Facts as enumerated in W.P.No.35168/2016 are referred to for the sake of convenience.
2. Petitioner has filed this writ petition under Articles 226 & 227 of Constitution of India seeking a declaration that proceedings initiated by the respondents herein under the provisions of Foreign Exchange Management Act, 1999 (for short, ‘FEMA’) are without jurisdiction. Petitioner has also sought for quashing the complaint dated 31.05.2016 filed against it under Section 16(3) of FEMA vide Annexure-B and the show-cause notice dated 06.06.2016 issued by the Special Director, Directorate of Enforcement, Government of India, Ministry of Finance, Chennai, vide Annexure-A.
3. Facts leading to this writ petition, briefly stated are that petitioner was engaged in the business of developing, operating and marketing integrated hybrid satellite terrestrial communication system and providing internet based multimedia and interactive data services. Petitioner entered into an agreement dated 28.01.2005 with Antrix Corporation Limited, a Government of India undertaking set up under the Department of Space. Petitioner applied to the Foreign Investment Promotion Board (for short, ‘FIPB’) on 02.02.2006 for approval of contemplated investments to be made by two US based investment firms and their subsidiaries in the petitioner Company. On 16.03.2006, petitioner along with other shareholders entered into a share subscription agreement with the subsidiary companies of the two US based investment firms setting out the terms and conditions of their investment. On 18.05.2006, FIPB granted approval to the application filed by the petitioner on 02.02.2006 with certain standard form conditions. The conditions imposed and the correspondence made between the parties, according to the petitioner, made it clear that all the concerned persons had accepted that the agreement shall be subject to Indian law. Petitioner claimed to have made further investments.
4. On 25.02.2011, Antrix terminated the agreement with petitioner. Petitioner invoked pre-arbitration steps and thereafter arbitration proceedings as per arbitration agreement for specific performance thereof and alternatively for damages/compensation in lieu of specific performance. It is alleged by petitioner that with a malafide intention to frustrate and derail the arbitration, Department of Space directed and instructed Department of Revenue and Department of Corporate Affairs to investigate and conduct a roving and fishing enquiry into the petitioner company and in particular under the Companies Act, FEMA and Prevention of Money- Laundering Act (for short, ‘PMLA’); that, as per letter dated 17.01.2014, addressed by the Department of Space to Ministry of Corporate Affairs, details were sought pertaining to the outcome of the investigation by Ministry of Corporate Affairs so as to enable the Government and the Antrix to use them in handling the arbitration proceedings. This, according to petitioner, disclosed that State machinery was being abused and misused for ulterior purposes, therefore, the show-cause notice dated 06.06.2016 was not in the realm of a show-cause notice.
5. It is also alleged that respondents had a predetermined mind with respect to petitioners’ liability and its quantification thereof. In this background, petitioner contends that proceedings initiated for investigation under FEMA are designed to frustrate the ICC award passed in favour of petitioner-company.
6. Sri Udaya Holla, and Sri Sajan Poovayya, learned Senior Counsel have addressed their arguments for the petitioners in these writ petitions.
7. Sri Nataraj, learned ASG has defended the action of respondents and has raised a preliminary question regarding maintainability of the writ petitions.
8. Learned senior counsel for petitioners have contended that writ petitions are maintainable for the following reasons:
(a) action of respondent – authorities is demonstrably actuated by malafides;
(b) the so-called show-cause notice is not actually a show-cause notice as the respondents have already premeditated and predetermined the liability of the petitioners; (c) that the alleged violations of provisions of FEMA by the petitioners is baseless; (d) the vicarious liability cannot be made applicable against the Directors; (d) existence of alternative remedy in the above circumstances was no bar for maintainability of the writ petitions.
9. In support of the contention that existence of alternative remedy is not a bar for invoking writ jurisdiction, learned Senior Counsel for the petitioners have placed reliance on the following judgments:
1. WHIRLPOOL CORPORATION Vs. REGISTRAR OF TRADE MARKS, MUMBAI 7 OTHERS – (1998) 8 SCC 1;
2. BAHADURSINGH LAKHUBHAI GOHIL Vs. JAGDISHBHAI M.KAMALIA & OTHERS – (2004) 2 SCC 65 3. A.V.VENKATESHWARAN Vs. RAMCHAND SOBHRAJ WADHWANI – AIR 1961 SC 1506;
4. UNION OF INDIA Vs. TANTIA CONSTRUCTION PRIVATE LIMITED – (2011) 5 SCC 697.
10. In support of the contention that impugned show- cause notice is amenable for challenge in the writ jurisdiction as it is not in the realm of a show-cause notice, petitioner has placed reliance on the following judgments:
1. SIEMENS LIMITED Vs. STATE OF MAHARASHTRA & OTHERS – (2006) 12 SCC 33;
2. K.I.SHEPHARD & OTHERS Vs. UNION OF INDIA & OTHERS - (1987) 4 SCC 431;
3. ORYX FISHERIES PRIVATE LIMITED Vs. UNION OF INDIA 7 OTHERS –(2010) 13 SCC 427.
11. In support of the contention that malice/malafides on the part of the State action enables a party to invoke jurisdiction under Article 226 of the Constitution, petitioner has placed reliance on the following judgments:
1. BAHADURSINGH LAKHUBHAI GOHIL Vs. JAGDISH BHAI M.KAMALAI & OTHERS – (2004) 2 SCC 65;
2. SIEMENS LIMITED Vs. STATE OF MAHARASHTRA & OTHERS – (2006) 12 SCC 33;
3. ORYX FISHERIES PRIVATE LIMITED Vs. UNION OF INDIA & OTHERS – (2010) 13 SCC 427.
12. Sri Sajan Poovayya, learned Senior Counsel appearing for the two Directors of Devas Multimedia Private Limited has, apart from addressing other common arguments referred to above in support of the challenge made has specifically contended that the contract was entered into between Devas and Antrix Corporation Limited on 28.01.2005 followed by execution of share subscription agreement dated 16.03.2006; Sri M.Umesh petitioner in W.P.No.35923/2016 resigned as Director of Devas on 06.04.2006; it was thereafter that FIPB granted its approval to the application filed by Devas seeking approval for investment to be made by the two US based companies and their subsidiaries in Devas. It is mainly urged that as Sri M.Umesh had already resigned as Director prior to the FIPB approval, there was absolutely no justification to proceed against Sri M.Umesh.
13. Insofar as Sri D.Venugopal, petitioner in W.P.No.35188/2016, it is urged that all the common grounds available to assail the impugned action for Devas were available to the present petitioner as well. In addition, it is contended that there was absolutely nothing to link the present petitioner with the allegation of violation of FEMA and vicarious liability could not be invoked in the circumstances of the case.
14. Sri Sajan Poovayya has placed reliance on the judgment in the case of S.M.S.PHARMACEUTICALS LIMITED VS. NEETA BHALLA AND ANOTHER - (2005) 8 SCC 89 to contend that it was necessary to state that at the time offence was committed, the person who was in- charge and responsible for conduct of business of the company, could be proceeded against under Section 141 of the Negotiable Instruments Act, 1881. He draws the same analogy in respect of the facts of the present case, to urge that the two Directors cannot be subjected to criminal process and vicarious liability cannot be fastened on all persons connected with the company as the principal accused in such case would be the company itself. Reliance is also placed on the judgment in the case of K.K. AHUJA VS. V.K.VORA AND ANOTHER - (2009) 10 SCC 48 to the same effect. It is also urged with the help of this decision that a person may be a Director, but to be vicariously liable, a person should fulfill legal requirement of being a person responsible to the company for the conduct of the business and in-charge of the business of the company.
15. Sri Nataraj, learned ASG has referred to the scheme of FEMA and the Rules framed thereunder. He refers to the judgment in SIEMENS LIMITED Vs. STATE OF MAHARASHTRA & OTHERS – (2006) 12 SCC 33 and distinguishes the same. He also takes me through various decisions relied upon by the learned counsel for petitioners to point out how the facts involved in those cases were distinct and different from the facts involved in the present case. He strongly refutes the contentions urged by the petitioners regarding alleged malafide intention behind initiation of proceedings, the alleged predetermined approach and the so-called apparently baseless allegations leveled against the petitioners Devas and its Directors. With regard to vicarious liability of some of the Directors, he has urged that adjudication proceedings in Section 16 read with Section 13 were wide, in that, it covered all kinds of contraventions ‘by any person’ regardless of whether he was a Director or not at the relevant point of time. He contends that the issue of vicarious liability would arise only after adjudication is made as per Section 16 read with Section 13 of FEMA. He invites the attention of the Court to Section 42 which deals with contraventions by companies and also provides protection to those without whose knowledge, consent or connivance such contravention had taken place. He, therefore, urges that in terms of Section 13, it would be immaterial whether one is an Ex-Director or present Director for the purpose of issuance of show-cause notice.
16. Learned counsel points out by referring to averments made in the complaint against the Directors that specific acts of violation have been alleged against them. In this regard, he invites the attention of the Court to Annexure-B - complaint particularly to paragraphs 5.2.3 and 5.2.5 against Sri M.Umesh and Sri D.Venugopal (Directors), petitioners in WP.35923/2016 and WP.35188/2016 respectively. Learned counsel also points out that several documents have been furnished in support of the averments made in the complaint. It is urged by him that FEMA is a self contained Code and provides a complete mechanism for adjudication of dispute regarding violations of the provisions and also provides appellate forum to challenge the orders passed. He has placed reliance on the decision in the case of RAJKUMAR SHIVHARE Vs. ASSISANT DIRECTOR, DIRECTORATE OF ENFORCEMENT AND ANOTHER - (2010) 4 SCC 772 in support of the contention that Chapter – V of FEMA read with the Rules framed provides a complete network of provisions adequately structuring the rights and remedies available to a person who is aggrieved by any adjudication under FEMA. Reliance is also placed on the judgment of the Division Bench of this Court in the case of KARNATAKA SILK INDUSTRIES CORPORATION LIMITED, BANGALORE Vs. Y.N.KRISHNA MURTHY – (2006) 2 Kar.L.J. 143 to contend that writ petition against show-cause notice should not be entertained in a routine manner. Reliance is also placed on the judgment in the case of EXECUTIVE ENGINEER, BIHAR STATE HOUSING BOARD Vs. RAMESH KUMAR SINGH AND OTHERS – (1996) 1 SCC 327 in this regard. Judgment in the case of UNION OF INDIA AND ANOTHER Vs. KUNISETTY SATYANARAYANA - AIR 2007 SC 906 has been relied upon particularly on the observations made in paragraph 14 to contend that a mere show-cause notice does not infringe the right of any one.
17. Learned Additional Solicitor General has also relied on the judgment of the Apex Court in the case of SPECIAL DIRECTOR AND ANOTHER Vs. MOHD. GHULAM GHOUSE AND ANOTHER - (2004) 3 SCC 440. Attention is drawn to the observations in paragraph 5. Similarly, judgment in the case of COMMISSIONER OF CUSTOMS (IMPORT), MUMBAI Vs. JAGDISH CANCER & RESEARCH CENTRE – 2001 (132) E.L.T. 257 (S.C.) is relied upon to urge that reading of the show-cause notice para wise and confining it in a water tight manner would not be a correct way of construing a notice because it had to be read as a whole to understand whether the person concerned was made aware of the various grounds on the basis of which action was proposed to be taken as well as the nature of the action. Reliance is also placed on the decision in the case of ASSISTANT COLLECTOR OF CENTRAL EXCISE, WEST BENGAL Vs DUNLOP INDIA LIMITED AND OTHERS – 1985 (19) E.L.T. 22 (S.C.).
18. In the light of the challenge made to the show cause notice and the complaint filed against petitioners and in the wake of preliminary objections raised by the learned Additional Solicitor General regarding the maintainability of the writ petitions, this Court has to decide whether the writ petition is maintainable.
19. Show cause notice assailed in the writ petition is produced at Annexure-A. A careful perusal of the same discloses that based on a complaint dated 31.05.2016 filed under Sub-section 3 of Section 16 of FEMA, Special Director and Adjudicating Authority has issued show cause notice placing reliance on the averments made in the complaint and the documents enclosed therewith thereby calling upon petitioners and certain others to show cause in writing within thirty days from the date of receipt of notice as to why adjudication proceedings as contemplated under Sub-Section 6 of Section 16 of FEMA should not be held against them in the manner provided under Rule 4 of the Foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000 for the alleged contravention of the provisions of FEMA and the Regulations framed thereunder. From the complaint enclosed to show cause notice and the documents produced therewith it was alleged that during the period from May 2006 to June 2010 petitioner – Company appeared to have received Foreign Investments totaling US$ 131,442,033.00 equivalent to Rs.578,53,63,207/- as detailed in the tabular column extracted in the notice.
20. In Paragraph 19 of the show cause notice, it has been stated that from the complaint and the documents it appeared that though petitioner had reported to engage themselves in development of software relating to multimedia services, it was actually engaged in telecommunication related services, a sector requiring FIPB approval for foreign direct investment and had not followed conditions prescribed in the approval given by the FIPB and also not followed its guidelines thereby foreign direct investment totalling to Rs.578,53,63,207/- was without valid approval of the Government of India and thus petitioner appeared to have contravened the provisions of Section 6(3)(b) of FEMA read with Regulations 4, 5(1) and Schedule-1 of the Foreign Exchange Managements (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000 and rendered themselves liable for penalty under Section 13(1) of FEMA, 1999.
21. Similar such allegations in connection with issuance of equity shares allegedly in contravention of the provisions of the Act have been made. Reference is made to Section 42 of the Act, which stipulates that where a person committing contravention of the provisions of the Act or the Rules was a company, every person, who at the time the contravention was committed, was in charge of and was responsible to the company for the conduct of business of the company as well as the company shall be deemed to be guilty of contravention and shall be liable to be proceeded against and punished accordingly. Section 42 is referred to proceed against two directors viz., D. Venugopal and M.Umesh along with certain others stating that they were responsible for conduct of business at the appropriate period, in addition to being signatories to the relevant share subscription agreements.
22. In issuing the show cause notice, adjudicating authority has placed reliance on several documents annexed to the complaint. In paragraph 35, it is specifically stated that in case it was decided to hold adjudication proceedings, personal hearing of the case could be waived at their request. However, in paragraph 36 of show cause notice, petitioners have been notified that they would be required to appear either in person or through legal practitioner duly authorised by them to explain and produce such documents or evidences, as may be useful for or relevant to the subject matter of enquiry, and in case, any of the noticees fail, neglect or refuse to appear before the undersigned on the appointed date and time, the adjudication proceedings shall proceed against such noticee ex-parte.
23. Therefore, sum and substance of the notice makes it very clear that specific allegations made against petitioners have been reproduced with reference to different provisions of the Act and the Rules and petitioners have been called upon to submit their explanation. Fact that in case it was decided to hold adjudication proceedings, question regarding grant of personal hearing, waiver of personal hearing, engaging services of counsel of their choice were open to petitioners, is also forthcoming from the show cause notice. This being the position, it cannot be said that adjudicating authority who has issued the show cause notice has predetermined the issue and has already formed an opinion regarding involvement of petitioners in the alleged violation of the provisions of the Act and the Rules.
24. Number of judgments have been relied upon by the two learned counsel for petitioners to contend that background in which complaint has been filed, show cause notice was issued, particularly, after the arbitration proceedings were commenced at the instance of petitioner – Company has to be kept in mind in appreciating the contention that respondent had proceeded with predetermined mind in issuing show cause notice. They also point out that after arbitration award was passed on 14.09.2015, show cause notice was issued on 06.06.2016 based on a complaint lodged on 31.05.2016 in great haste.
25. It is apparent from the materials on record that adjudication process has not yet started. It is well established by a catena of decisions of the Apex Court that High Court will not entertain a petition under Article 226 of the Constitution, if an effective alternative remedy is available to the aggrieved person or the statute under which action complained of has been taken, itself contains a mechanism for redressal of the grievance. This principle is well enunciated in the case of NIVEDITA SHARMA Vs. CELLULAR OPERATORS ASSOCIATION OF INDIA – (2011) 14 SCC 337. In fact, the Apex Court in the case of SPECIAL DIRECTOR AND ANOTHER Vs. MOHD. GHULAM GHOUSE AND ANOTHER - (2004) 3 SCC 440, has deprecated the practice of High Courts entertaining writ petitions questioning the legality of the show-cause notices, thereby stalling enquiries retarding investigative process initiated to find actual facts with the participation and in the presence of the parties unless the petitioner established absolute want of jurisdiction or authority to even investigate into facts. It is observed in this context that writ petitions should not be entertained and the petitioner should invariably be directed to respond to the show-cause notice.
26. Perusal of the impugned notice does not disclose that respondent – adjudicating authority has predetermined the issue. Unless show cause notice contains all specific details regarding the nature of violation, quantum of violation alleged, it will suffer from want of details so as to enable effective reply from petitioner. Therefore, when full details are given regarding the allegations made based on complaint and documents produced, show cause notice cannot be characterized as one that predetermines the issue.
27. Regarding the background in which action is initiated under FEMA against petitioners and allegation of malafides, it has to be noticed that there cannot be any dispute that jurisdiction under Article 226 and 227 of the Constitution of India can be invoked if there is absolute want of jurisdiction or if the action is malafide. There can be no difficulty in appreciating this contention which finds support from several decisions. However, at the same time it has to be pointed out that merely because petitioner – Company had initiated arbitration proceedings and had secured an award in its favour regarding the contract pertaining to certain supplies and services to be extended to Antrix Corporation, it cannot be said that all actions initiated by the competent authorities of the Central Government against petitioners for alleged violation of FEMA had to be viewed with suspicion attributing malice and bad faith. The reason why the agreement was annulled, the manner in which the agreement was entered into, its review by high power review committee, the report and the recommendation of the committee based on which decision had been taken for investigation into various affairs of petitioners by the department of Corporate Affairs and also department of Revenue have to be viewed together. They appear to be the result of natural course of events. The same cannot be characterized as malicious. 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.
28. As rightly contended by learned Additional Solicitor General placing reliance on several judgments of the Apex Court including the judgment in the case of RAJKUMAR SHIVHARE Vs. ASSISANT DIRECTOR, DIRECTORATE OF ENFORCEMENT AND ANOTHER - (2010) 4 SCC 772 Chapter 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.
29. 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.
30. Though several judgments have been relied upon by learned Senior counsel for petitioners, facts involved in the present case being distinct and different, ratio laid down in those judgments are not applicable to the case of petitioners. Petitioners have adequate safeguards in the form of effective remedies within the four corners of FEMA to seek redressal. The same process of reasoning is applicable to both the Directors who have filed separate writ petitions.
31. 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.
Sd/- JUDGE PKS/VP