TIMES INTERNET LIMITED Vs. DIRECTORATE OF ENFORCEMENT

JUDGEMENT

(1.) Times Internet Limited ["TIL", Petitioner in W.P.(C) 15242/2023] is a subsidiary of Bennet Coleman and Co. Ltd ["Bennet Coleman", Petitioner in W.P.(C) 15471/2023], who are widely recognized as the Times of India Group, which is one of India's largest media conglomerates. As a digital venture of the Times of India group, TIL is engaged in providing information technology-based internet/digital services, digital content, on-line advertisement services on an international scale, operating diverse portals and websites. Both the Petitioner companies have Wholly Owned Subsidiaries ["WOS"] abroad by the names of Times Internet Inc. and BCCL Worldwide Inc., respectively. These WOSs were established by the Petitioners to facilitate international operations and investments. As part of their business strategy, the Petitioners are required to remit funds to these WOS in the form of overseas direct investments.

(2.) For this purpose, both the Petitioners sought No Objection Certificates ["NOC"] from Respondent No. 1 - Directorate of Enforcement ["ED"] under Rule 10 of the Foreign Exchange Management (Overseas Investment) Rules, 2022 ["FEMA OI Rules, 2022"]. However, their request was denied. The Petitioners argue that the non-grant of NOC has prevented them from transferring funds to their WOS entities, thereby hampering their investment plans and disrupting global operations. Thus, through the present writ petitions, the Petitioners seek to challenge the impugned communications issued by the Respondent, rejecting their applications for NOCs.

(3.) Both the Petitioner companies are Indian entities classified as "person resident in India" in terms of Sec. 2(b)(ii) of the Foreign Exchange Management Act, 1999 ["FEMA, 1999"]. Over the years, the Petitioners have consistently engaged in overseas investments by establishing various WOSs, Subsidiaries, and Special Purpose Vehicles in various jurisdictions while strictly adhering to the applicable foreign exchange laws.