Seizure Under 37A FEMA Cannot Continue After Repatriation Of Foreign Exchange: SAFEMA Tribunal

On 14 May, the Appellate Tribunal under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act (SAFEMA) held that seizure of an equivalent asset in India under Section 37A of the Foreign Exchange Management Act (FEMA) cannot continue once the resident no longer holds the overseas asset and the equivalent foreign exchange value has been repatriated to India. A Bench comprising Members Balesh Kumar and Rajesh Malhotra allowed the appeal filed by Devendra N. Desai and set...

SAFEMA Appellate Tribunal Restores Seizure Of DMK MP Jagathrakshakan's Children's Properties In FEMA Case

The Appellate Tribunal under SAFEMA has partly allowed the ED's appeal in the foreign assets case involving DMK MP S. Jagathrakshakan and his family. It restored seizure of properties belonging to his children over shareholdings in a Singaporean company. It, however, upheld the release of properties belonging to Jagathrakshakan and his late wife. The Tribunal said the same shares could not be used to justify repeated attachment. The coram of Members Balesh Kumar and Rajesh Malhotra passed the...

SAFEMA Tribunal Reduces Garg Iron FEMA Penalty To ₹5.5 Lakh, Holds Customs Exoneration No Bar

The Appellate Tribunal under SAFEMA on 7 May held that Garg Iron & Energy Pvt. Ltd. violated Foreign Exchange Management Act (FEMA), 1999 by failing to repatriate unutilised foreign exchange and by relying on post-facto third-party adjustments without RBI approval. It also reiterated that Customs exoneration does not bar proceedings under FEMA.A Bench comprising Members Balesh Kumar and Rajesh Malhotra partly allowed the appeal and reduced the penalty from Rs. 11 lakh to Rs. 5.5 lakh, while...

SAFEMA Appellate Tribunal Cuts BPL, Ex-MD Penalties To ₹10L, ₹1L In ₹4.9 Crore FEMA Violation Case

The Appellate Tribunal under SAFEMA has reduced penalties on BPL Limited and its former Managing Director, Ajit G. Nambiar, to Rs. 10 lakh and Rs. 1 lakh respectively in a FEMA case over foreign remittances worth about Rs. 4.90 crore for which the company failed to prove imports. It, however, upheld the findings of contravention against both. The coram comprising Members Balesh Kumar and Rajesh Malhotra was hearing appeals against an August 31, 2016 order passed by the Joint Director,...

SAFEMA Appellate Tribunal Upholds ₹3 Crore FEMA Penalty Against Thomas Cook India

The Appellate Tribunal under SAFEMA at New Delhi has upheld penalties of Rs. 1.5 crore each imposed on Thomas Cook India Ltd. for contraventions relating to the issuance of forex cards worth over Rs. 14.29 crore to 255 persons while exonerating its General Manager Amit Bhatia. The tribunal, comprising members Balesh Kumar and Rajesh Malhotra, was dealing with appeals filed by Thomas Cook India Ltd. and Bhatia against the adjudication order dated March 30, 2020, passed by the Additional...

SAFEMA Appellate Tribunal Upholds ₹83 Lakh FEMA Penalty On Tata Capital Forex In ₹8.36 Crore Forex Card Case

The Appellate Tribunal under SAFEMA has upheld an Rs. 83 lakh penalty imposed on Tata Capital Forex Ltd. for violating foreign exchange laws in a case involving forex prepaid cards worth over Rs. 8.36 crore. It, however, granted partial relief to the company's former regional manager, Ashwin Savoor, by reducing his penalty from Rs. 83 lakh to Rs. 16.6 lakh. A coram of Members Balesh Kumar and Rajesh Malhotra observed: “Even though being an Authorised Person, they not only failed to be prudent...

Centre Mandates Govt. Route For Investments With Beneficial Ownership Linked To Border Countries

The Centre has mandated that investments into India in non-debt instruments, including equity, by entities or individuals from countries sharing a land border with India, as well as investments where the beneficial ownership is traceable to such countries, must be made only through the Government approval route, under amendments notified on May 1, 2026. The Ministry of Finance, Department of Economic Affairs, brought into force the Foreign Exchange Management (Non-debt Instruments) (Amendment)...

Delhi High Court Sets Aside FEMA Confiscation For Lack Of Reasons, Upholds Penalty

The Delhi High Court has set aside confiscation orders passed under the Foreign Exchange Management Act, 1999 (FEMA), holding that such action cannot be sustained in the absence of reasons.A Division Bench of Justices Navin Chawla and Ravinder Dudeja partly allowed a batch of appeals filed against orders of the Appellate Tribunal for Foreign Exchange, which had affirmed penalties as well as confiscation of funds lying in Non-Resident (Non-Repatriable) Rupee (NRNR) accounts.The case arose from...

SAFEMA Tribunal Upholds ₹5 Crore Penalty on J.B. Diamonds For FEMA Violation

The Appellate Tribunal under SAFEMA, New Delhi, has upheld a penalty of Rs. 5 crore imposed on J.B. Diamonds Ltd. for failure to realise export proceeds exceeding USD 117 million within the prescribed period under the Foreign Exchange Management Act, 1999, while also affirming the liability of its directors. The tribunal, however, granted relief to one director—a homemaker holding that she was not involved in the day-to-day affairs of the company. A coram led by Chairman Justice Munishwar...

Adjudicating Authority Abdicated Appellate Powers, Supreme Court Sets Aside FEMA Order Passed Pending Appeal

The Supreme Court has set aside a Madras High Court judgment and a final adjudication order under the Foreign Exchange Management Act, holding that the Adjudicating Authority acted improperly by effectively overriding an order refusing to confirm seizure while that order was under appeal. A Bench of Justices Vikram Nath and Sandeep Mehta observed, “In effect, the Adjudicating Authority has undone the order of the Competent Authority even while the appeal against the said order is pending. Such...

SAFEMA Tribunal Confirms ₹50 Lakh ED Attachment In Syndicate Bank Bribery Case Linked To Former CMD

The Appellate Tribunal under SAFEMA on 12 March held that the provisional attachment of Rs. 50 lakh recovered from the close relatives of Syndicate Bank's former CMD constitutes proceeds of crime under the Prevention of Money Laundering Act (PMLA). A Bench comprising Members Balesh Kumar and Rajesh Malhotra allowed the appeal filed by the Directorate of Enforcement (ED), setting aside the order of the Adjudicating Authority, which had earlier declined to confirm the provisional attachment of...

Damages Awarded By Foreign Court Cannot Be Subject To FEMA, RBI Ceiling: Delhi High Court

The Delhi High Court on Monday held that damages awarded by a competent foreign court for breach of contract cannot be subjected to ceilings prescribed under the Foreign Exchange Management Act or RBI guidelines. “In my considered view, the amounts awarded by a competent Court, whether Indian or foreign, towards damages for breach of contract, cannot be subject to ceilings prescribed under FEMA and/or RBI directions/circulars,” Justice Amit Bansal observed while allowing execution of an English...