Abuse of process in FERA prosecution: criminal proceedings quashed after identical departmental charges were dropped as vague and presumptive.

A criminal prosecution under the Foreign Exchange Regulation Act, 1973 was found unsustainable where departmental proceedings on substantially identical allegations had already been dropped as being based on presumptions, surmises and vague charges. The Court held that the material did not justify continuing the prosecution for alleged contraventions under the Act, and treated the proceeding as an abuse of process. The criminal case was therefore quashed and the petitioner discharged.

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Issues: Whether the criminal proceeding under the Foreign Exchange Regulation Act, 1973 should be quashed in view of the dropped departmental proceedings on the same allegations.

Analysis: The revisional application under Section 482 of the Code of Criminal Procedure, 1973 challenged the legality and propriety of the pending criminal case under Sections 56 and 68 of the Foreign Exchange Regulation Act, 1973. The Court noted that the departmental proceeding arising out of substantially identical allegations had been adjudicated and dropped on the ground that the charges were based on presumptions and surmises and were not specific. In view of that conclusion, the Court found that the material did not support continuation of the prosecution for alleged contraventions under Sections 8(1) and 9(1a) of the Foreign Exchange Regulation Act, 1973.

Conclusion: The criminal proceeding was held to be an abuse of process and was quashed, and the petitioner was discharged.

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