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Issues:
1. Permission to utilize frozen assets by investing in petitioner's concerns and their repatriation. 2. Interpretation of Foreign Exchange Regulation Act regarding the petitioner's residency status. 3. Seeking relief beyond the petition and the legality of the requested transaction. 4. Consideration of the impact of frozen funds on the petitioner and the necessity of granting permission for their utilization. Detailed Analysis: 1. The petitioner, a Non-Resident Indian (NRI), brought significant foreign exchange to India for investment in two ventures. However, the petitioner was later intimated of being treated as a resident, leading to the filing of a petition seeking a declaration as an NRI under the Foreign Exchange Regulation Act. The petition also requested to restrain the respondents from treating the petitioner's accounts as those of a resident. The court granted interim relief by freezing the assets pending the outcome of the petition. 2. The petitioner sought permission to loan the Indian Rupee equivalent of unutilizable foreign exchange to their ventures, Supersonic and Ebasco, with the condition of repatriation only if the petition succeeds. The court addressed objections raised by the respondents, stating that the relief sought in the motion was not beyond the scope of the petition. The court emphasized that once the declarations and injunctions sought in the petition are granted, the petitioner would be free to repatriate the funds, even if not explicitly mentioned in the petition. 3. The court rejected the objections raised by respondents regarding the legality of granting permission for the utilization of frozen funds. It highlighted the petitioner's predicament of facing losses due to the unproductive state of the frozen assets and the adverse impact of inflation on the value of the funds. The court emphasized that allowing the funds to remain idle could cause irreparable harm to the petitioner, and granting permission for interest-free loans to the petitioner's ventures was a reasonable solution. 4. Ultimately, the court made the motion absolute, permitting the petitioner to utilize the frozen assets by loaning them to Supersonic and Ebasco, with the conditions that the loans would be interest-free and repatriation would be at the prevailing rate of exchange if the petition succeeds. The court concluded that granting such relief was justified to prevent further financial losses to the petitioner and did not contravene any legal principles or policies.
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