2013 (3) TMI 507 - HC - FEMA

Section 8(1) of the Foreign Exchange Regulation Act, 1973 (FERA) - The petitioner and one Seethalakshmi Nagaraj were examined under Section 40 FERA and it was their common stand that the money seized belonged to Seethalakshmi Nagaraj and with the permission of the mother of the petitioner, the same had been left with his wife for safekeeping. Despite an opportunity notice, the petitioner had not been able to show that he had obtained any permission from the Reserve Bank of India - Charge of commission of offence u/s 8(1) punishable under Section 56(1)(i) of FERA - Held that - To meet the charge of having acquired foreign exchange, it must be shown that the petitioner was the owner thereof, whereas the finding of the Division Bench is that there was nothing to show that the same belonged to the petitioner. We may inform that the Court below indeed is wrong in observing that no petition for discharge would like after the recording of the preliminary prosecution evidence under Section 244 Cr.P.C. This Revision shall stand allowed. The petitioner shall stand discharged of the charge against him in C.C. No. 252 of 1997 before the Court. Consequently, connected miscellaneous petition is closed.

Summary

Issues:
1. Dismissal of petition for discharge under Section 244 Cr.P.C.
2. Interpretation of the term 'acquire' in relation to possession of foreign exchange.
3. Precedentiary value of previous court decisions on similar facts.
4. Prosecution's burden of proof in establishing ownership of seized foreign currency.

Analysis:

1. The revision pertains to the dismissal of the petitioner's discharge plea under Section 244 Cr.P.C. by the Additional Chief Metropolitan Magistrate. The petitioner, accused of contravening FERA provisions, sought discharge which was denied by the lower court, stating that the prosecution had established a prima facie case and the matter should proceed to trial for framing charges.

2. The key issue revolves around the interpretation of the term 'acquire' in the context of possessing foreign exchange without permission. The petitioner argued that the mere possession of foreign currency does not amount to acquisition under FERA. Citing precedents and court decisions, the petitioner contended that there was no evidence to prove ownership of the seized foreign currency, emphasizing that the Income Tax Appellate Tribunal had previously ruled in favor of the petitioner regarding the inclusion of the currency in his income.

3. The petitioner relied on the precedentiary value of previous court decisions, highlighting a Division Bench ruling that supported the petitioner's explanation regarding the seized currencies. This emphasized the importance of consistency in legal interpretations and the relevance of past judgments in determining the outcome of the current case.

4. The prosecution's case hinged on proving that the seized foreign currency exclusively belonged to the petitioner, linking it to the offense under FERA. However, the defense successfully argued that there was no concrete evidence establishing ownership of the currency by the petitioner. The court noted the lack of fresh material or evidence to support the prosecution's claim, ultimately leading to the allowance of the revision and the discharge of the petitioner from the charges in C.C. No. 252 of 1997.

In conclusion, the judgment delves into the nuances of FERA provisions, the burden of proof on the prosecution, and the significance of past court decisions in shaping legal outcomes. The detailed analysis underscores the importance of evidence, legal interpretations, and consistency in judicial decisions in resolving complex legal matters.