KIIFB officials and Isaac first filed petitions before the High Court in 2022 challenging the ED summons issued to them at that point in connection with the central agency’s probe in the case.
However, in December 2023, the ED informed the High Court that it had decided to withdraw those summons.
At the time, the Court had clarified that the ED was free to continue its probe in the case.
In January this year, the ED issued fresh summons to Isaac and KIIFB officials following which Isaac and KIIFB filed this fresh round of petitions challenging the same.
The primary ground raised by both Isaac and the KIIFB officials was that the summons issued to them contained no mention of what transactions were being investigated. They also argued that the summons don’t contain any information about the alleged contraventions of FEMA.
According to both petitioners, as per Section 37 of the FEMA, it is the RBI that is the appropriate authority to investigate if there is any contravention. If any contraventions that are mentioned in Section 13 of the Act are detected, the the RBI can approach the adjudicating authority which can then direct the ED to investigate the case.
Effectively, their argument was that the ED did not have the jurisdiction to conduct probe at this stage.
Both the ED and the RBI were united in their opposition to this contention.
Source: Barandbench
