KANWAR NATWAR SINGH Vs. DIRECTOR OF ENFORCEMENT

JUDGEMENT

(1.) ONE of the primary questions that falls for consideration in these two appeals is whether the appellants are entitled to demand copies of even such of the documents as are not relied upon against them by the Directorate of enforcement in connection with an Inquiry initiated under the provisions of section 16 (1) of Foreign Exchange Management Act, 1999 read with Rule 4 of the foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000. The Adjudicating Authority's refusal to supply the said documents led to the filing of WPs (C) No. 1970/2007 and 1971/2007 by the appellant, which were heard and dismissed by a learned Single Judge of this Court, relying upon the decisions of the Supreme Court in Radhakrishnan Prabhakaran v. State of T. N. And others 2000 (9) SCC 170, Syndicate Bank and Others v. Venkatesh Gururao Kurati 2006 (3) SCC 150, Standard Chartered Bank and Others v. Directorate of enforcement and Others 2006 (4) SCC 278, Chandrama Tewari v. Union of India (Through General Manager, Eastern Railways) 1987 (Supp) SCC 518 and Krishna chandra Tandon v. The Union of India 1974 (4) SCC 374. The learned Single Judge was of the opinion that supply of only such of the documents as were relied upon by the Directorate of Enforcement was necessary before the commencement of the enquiry proceedings. The appellants assail the correctness of that view in these appeals and pray for a direction to the respondent to supply copies of all such documents as are in possession of the Directorate of Enforcement regardless whether or not such documents are being relied upon by it before the adjudicating Authority. The controversy arises in the following backdrop:

(2.) AS a sequel to what came to be known as "volkar Committee Report" on oil-For-Food Programme of the United Nations in Iraq and the report submitted by the Pathak Committee of Inquiry, a complaint alleging violation of the provisions of Section 13 of Foreign Exchange Management Act was filed against the appellants before the Adjudicating Authority. The Authority in turn issued a show cause notice to the appellants and a few others, inter-alia, calling upon them to show cause why adjudication proceedings as contemplated under Section 16 (1) of FEMA, 1999 read with Rule 4 of the Foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000 should not be held against them for the contraventions referred to in the notice and why penalty as provided under Section 13 (1) of the said Act be not imposed upon them. On receipt of the show cause notice, the appellants demanded copies of the documents referred to and relied upon in the notices and also other documents relating to the proposed Inquiry. It is not in dispute that copies of all such documents as are relied upon by the Directorate of Enforcement were furnished to the appellant. Copies of other documents complete details whereof were not indicated by the appellant were, however, declined in terms of an order/communication dated 6th December, 2006 sent to the appellants by the adjudicating Authority. By another order/communication of even date, the adjudicating Authority decided to hold an Inquiry in terms of Section 16 (1) of fema, 1999 read with Rule 4 of the Foreign Exchange Management (Adjudication proceedings and Appeal) Rules, 2000.

(3.) AGGRIEVED by the aforesaid orders and communications, the appellant shri Natwar Singh filed writ petition No. 18901/2006 in this Court, which was disposed of by a Single Judge of this Court by order dated 18th December, 2006 with the direction that the petitioner shall have four weeks further time to file his reply to the show cause notice served upon him. As regards the prayer for supply of copies of the documents, the Court gave liberty to the petitioner to demand such copies but left the issue regarding the entitlement of the petitioner to such documents open.