2016 (12) TMI 1805 - HC - FEMA

Compounding application of the petitioner Company and/or its Director/s - HELD THAT - It is provided that in case if the petitioner Company and its Director/s file an independent application under the provisions of the Foreign Exchange Management Act, 1999 and/or the Foreign Exchange (Compounding Proceedings) Rules, 2000, before respondent No.2 - Authority, the same shall be considered on their own merits, within a period of 180 days statutorily provided under the Rules. The order that may be passed and communicated to the petitioner Company or its Director/s should be a reasoned order. Learned counsel for the petitioners states that compounding application of the petitioner Company and/or its Director/s shall be filed with all complete details and documents latest by 02nd January, 2017.

Summary

Issues:
1. Consideration of compounding application under Foreign Exchange Management Act, 1999 and Foreign Exchange (Compounding Proceedings) Rules, 2000.

Analysis:
The judgment delivered by Mr. R.M.Chhaya, J., of the Gujarat High Court, addressed the issue of considering a compounding application under the Foreign Exchange Management Act, 1999, and the Foreign Exchange (Compounding Proceedings) Rules, 2000. The court, without expressing any opinion on merits, directed that if the petitioner Company and its Director/s file an independent application before the relevant authority, the application should be considered within 180 days as provided under the Rules. The order issued in response to the application should be a reasoned order, ensuring transparency and legal validity in the decision-making process.

The court emphasized the importance of filing the compounding application with all complete details and documents by a specified date, which was set as the 2nd of January, 2017. This requirement aimed to streamline the process and ensure that all necessary information is provided to facilitate a thorough and efficient review of the application. By setting a deadline for submission, the court sought to expedite the resolution of the matter and enable timely consideration of the compounding request.

Ultimately, the petition was disposed of based on the understanding that the petitioner Company and its Director/s would follow the prescribed procedure by submitting a comprehensive compounding application within the stipulated timeline. The judgment highlighted the significance of adherence to legal requirements and procedural formalities in seeking redress under the relevant laws governing foreign exchange transactions.