Inordinate delay in penal adjudication can vitiate confiscation proceedings where the noticee's defence is seriously prejudiced.

Adjudication under the Foreign Exchange Regulation Act was quashed because the proceedings were left pending for an inordinate, unexplained period and the delay caused real prejudice to the noticee's defence. The Court held that penal proceedings must be pursued with reasonable expedition and that prolonged dormancy, non-service of notice, withholding of relied-upon documents, and failure to address requests for copies and cross-examination violated the right to a fair and expeditious process under Article 21. As the delay was systemic and had impaired the ability to defend, the confiscation action could not stand and the seized amount was ordered to be released.

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Issues: Whether adjudication proceedings under the Foreign Exchange Regulation Act, 1973 could be continued after an inordinate and unexplained delay, and whether the proceedings and consequent confiscation action were liable to be quashed.

Analysis: The writ petition challenged a show cause notice and the ensuing adjudication on the ground that the proceedings had remained pending for years without any justification attributable to the petitioner. The Court applied the principle that proceedings having penal consequences must be pursued with reasonable expedition, drawing support from the right to speedy adjudication inherent in Article 21 of the Constitution of India. It found that the delay was systemic and prolonged: the notice was not effectively served for a long time, relied upon documents were withheld for years, and the petitioner's requests for copies and cross-examination were not meaningfully addressed. The Court held that this lapse had caused serious prejudice because relevant evidence had likely been lost and the petitioner's ability to defend himself had been impaired.

Conclusion: The adjudication proceedings were quashed for undue and unexplained delay, and the seized amount was directed to be released to the petitioner.

Ratio Decidendi: Where adjudication under a penal statute is left dormant for an inordinate period without justification and the delay prejudices the noticee's defence, the proceedings may be quashed in exercise of writ jurisdiction on the ground of violation of the right to fair and expeditious process.

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