2009 (4) TMI 442 - HC - Companies Law

Order on charge challenged - Held that - Do not find any reason to interfere with the order framing of the charge which has to be passed by taking a prima facie view of the matter and not on the basis of any concrete evidence which may establish that petitioner would certainly be convicted of the charges levelled against him. I need not repeat the judgments which have been already cited in the order framing the charges in this regard. Hence I do not find any merits in this case. Petition filed by the petitioner is dismissed.

Issues Involved:
1. Legality of the order on charge dated 25-11-2006 and the charge framed on 16-12-2006.
2. Alleged contravention of section 8(1) of the Foreign Exchange Regulation Act, 1973 (FERA) and its punishability under section 56 of FERA.
3. Validity of the evidence and statements used to frame the charges.
4. Petitioner's arguments against the framing of charges.
5. Respondents' counter-arguments supporting the framing of charges.

Detailed Analysis:

1. Legality of the Order on Charge and the Charge Framed:
The petitioner sought to set aside the order on charge dated 25-11-2006 and the charge framed on 16-12-2006 by the Additional Chief Metropolitan Magistrate (ACMM), Patiala House, New Delhi. The ACMM framed charges based on a complaint filed under section 8(5) read with section 56 of FERA and sub-sections (3) and (4) of section 49 of FEMA. The complaint alleged that the petitioner and others acquired foreign exchange without the permission of the Reserve Bank of India (RBI), violating section 8(1) of FERA.

2. Alleged Contravention of Section 8(1) of FERA:
The charges were framed against the petitioner for acquiring foreign exchange worth US$ 10,500 and US$ 1,39,000 without RBI's permission, thereby contravening section 8(1) of FERA. The petitioner was directed to be tried for these offences. The ACMM found sufficient material on record to show a prima facie case of violation of section 8(1) of FERA, punishable under section 56 of FERA.

3. Validity of the Evidence and Statements:
The evidence included statements from various individuals, including Shri Akbar J. Verjee, who admitted that the NRE account was opened at the request of Mr. Chandraswami and that he handed over signed cheques to Mr. Vikram Singh. The ACMM relied on these statements and other documentary evidence, such as the details of the NRE account and transactions, to frame charges. The court held that even a strong suspicion founded upon material before the Magistrate could justify the framing of charges.

4. Petitioner's Arguments Against the Framing of Charges:
The petitioner argued that the NRE account transactions were permissible and did not constitute a violation of section 8(1) of FERA. The petitioner contended that the NRE cheque of Rs. 30 lakhs was not foreign exchange and that the deposits were made in an authorized manner. The petitioner also argued that the opportunity notice was not served, and the allegations in the complaint did not establish possession or acquisition of foreign exchange.

5. Respondents' Counter-Arguments:
The respondents countered that the petitioner received foreign exchange without RBI's permission, as evidenced by the statements of Shri Akbar Verjee and others. They argued that the deposits in the NRE account were unauthorized and that the petitioner and others manipulated FERA provisions to bring foreign exchange into India clandestinely. The respondents maintained that the evidence was sufficient to frame charges under section 8(1) of FERA.

Conclusion:
The court concluded that there was sufficient material on record to frame charges against the petitioner under section 8(1) of FERA. The petitioner's arguments were found to be matters of defense that could be addressed during the trial. The court dismissed the petition, upholding the order framing charges, and directed the parties to appear before the Trial Court on 17-4-2009.

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