Supreme Court Quashes 24-Year-Old FERA Proceedings Against Standard Chartered Bank Due to Procedural Lapses, Significant Judgment Highlights the Importance of Adherence to Natural Justice and Right to Speedy Trial
In a landmark judgment, the Supreme Court of India has quashed criminal proceedings dating back to 2002 against Standard Chartered Bank and one of its officers under the Foreign Exchange Regulation Act, 1973 (FERA). The proceedings, which stemmed from alleged violations in 1991-1992, were terminated due to procedural lapses and a violation of the appellants' right to a speedy trial.
The appeals, heard by Justices J.B. Pardiwala and Manoj Misra, focused on three critical issues: the maintainability of petitions under Section 482 of the CrPC despite available alternative remedies, non-compliance with the mandatory opportunity notice under Section 61(2) of FERA, and the violation of the appellants' fundamental right to a speedy trial as enshrined under Article 21 of the Constitution of India.
The Court held that the High Court had erred in rejecting the petitions on maintainability grounds, clarifying that the inherent powers under Section 482 of the CrPC are not barred by the availability of a revisional remedy under Section 397. The judgment reiterated that the inherent powers are intended to prevent abuse of the process of the court and to secure the ends of justice.
Significantly, the Supreme Court found that the prosecution had failed to comply with the mandatory requirement of serving an opportunity notice under Section 61(2) of FERA. This provision necessitates that the accused be given a chance to show that they had the requisite permission for the alleged contravention before any complaint can be filed. The Court noted that there was no evidence of such a notice being issued or served, rendering the proceedings unsustainable.
Moreover, the judgment highlighted the undue delay in the proceedings, noting a period of 24 years since the complaint was filed and over three decades since the alleged transactions. The Court emphasized that the right to a speedy trial is a fundamental right under Article 21, which had been grossly violated in this case due to the prosecution's persistent inaction and lack of diligence.
The Supreme Court's decision underscores the judiciary's commitment to upholding the principles of natural justice and the constitutional right to a speedy trial. By quashing the proceedings, the Court has set a precedent emphasizing the need for procedural compliance and diligence in criminal prosecutions.
Bottom Line:
Section 61(2) of FERA - Non-compliance with mandatory requirement of opportunity notice warrants quashing of complaint and summoning order - Opportunity notice must be meaningful and adequately served before initiation of prosecution.
Statutory provision(s):
- Section 482 of the Code of Criminal Procedure, 1973
- Section 397 of the Code of Criminal Procedure, 1973
- Section 61(2) of the Foreign Exchange Regulation Act, 1973
- Article 21 of the Constitution of India
