New Delhi, In a relief to the Standard Chartered Bank, the Supreme Court on Tuesday quashed a 23-year-old criminal complaint and summons issued under FERA provisions, saying that the complaint was not supported by any documentary evidence.
A bench of Justices J B Pardiwala and Manoj Misra exercised its inherent powers to quash the complaint and said that 23 years have now elapsed since the institution of the complaint and over three decades since the transaction it concerns without the trial having progressed beyond the stage of service of summons.
The top court set aside the Bombay High Court orders and said, “In view of all that is stated above, we are of the considered view that this is a fit case warranting the exercise of the inherent powers of this court to bring these proceedings to an end.”
It said the complaint itself was not supported by any documentary evidence and rests upon an alleged opportunity notice under Section 61(2) of the Foreign Exchange Regulation Act, 1973 (FERA).
“The respondent-complainant have, till date, not been able to produce the same or even date it with any precision. It is pertinent to mention that 23 years have now elapsed since the institution of the complaint, and over three decades since the transaction it concerns, without the trial having progressed beyond the stage of service of summons,” the top court said in its verdict.
It added that to permit the complainant to continue in such circumstances would be to allow the bank and its officials to remain in a “state of suspended animation indefinitely”.
“We accordingly hold that the complaint… and the summoning order dated May 30, 2002 issued therein are liable to be quashed as against the appellants herein only. We accordingly pass such an order,” the bench ordered.
The top court answered the question whether the high court was correct in holding that the availability of an alternative remedy of filing a revision under Section 397 of the CrPC would operate as a bar to the maintainability of a petition under Section 482 of the CrPC (for quashing of the case).
The bench said the availability of an alternative remedy of revision under Section 397 of the CrPC does not, by itself, operate as a bar to the exercise of the inherent jurisdiction of the high court under Section 482 of the CrPC.
Justice Pardiwala, writing the judgement for the bench, said that the two provisions operate in distinct spheres, and the mere existence of a revisional remedy cannot be treated as ousting the jurisdiction preserved under Section 482, which is available wherever there is an abuse of the process of the court or where the ends of justice so require, the only limitation upon its exercise being one of self-restraint.
“Thus, the availability of the remedy of revision under Section 397 of the CrPC could not have been made the threshold on which the maintainability of the appellants’ applications under Section 482 was to be tested.
“We are of the opinion that the high court erred in treating the availability of the remedy of revision under Section 397 of the CrPC as the threshold for examining the maintainability of the appellants’ applications under Section 482 of the CrPC,” it ruled.
The top court also examined the question whether the non-compliance with the mandatory requirement of an opportunity notice under the proviso to Section 61(2) of FERA warrants quashing of the criminal complaints and the summoning order issued against the appellants.
It said Section 61 of FERA sets out the statutory requirements that must mandatorily be satisfied before a court can take cognisance of the offences under the Act.
“Under Section 61, cognisance of an offence punishable under Sections 56 and 57 of FERA, respectively, can be taken by a court only upon a written complaint made by the Director of Enforcement, the Central Government, or the RBI, or by a person authorised by any one of them to make such a complaint,” it said.
It said under the proviso to Section 61(2), where the alleged contravention consists of doing an act without permission, no complaint can be made unless the person accused of the offence has first been given an opportunity to show that he had such permission.
The bench ruled that the service of an opportunity notice under the proviso to Section 61(2) of FERA is a mandatory requirement, without compliance of which no complaint under Section 56 or 57 of FERA respectively, can validly be instituted, and no magistrate can validly take cognisance of the offence alleged therein.
“This opportunity must be meaningful and adequate, and not a mere technical or notional compliance, given the drastic penal consequences that follow from proceedings under FERA. The burden lies upon the prosecution to establish, at the threshold, that such notice was issued and served in the prescribed manner.
“The Magistrate shall satisfy himself, before taking cognisance, that such opportunity was in fact given, or otherwise it may render the order taking cognisance unsustainable and liable to be quashed,” it said.
The top court was also critical of the approach of the authorities under FERA and said the record discloses a chronicle of persistent and unexplained inaction on the part of the complainant itself, spanning virtually the entire life of these proceedings.
