High Court Orders Return of Rs.89 Crore Bank Guarantee to Petitioner

The High Court directed the Revenue to return the original bank guarantee worth Rs.89 crore to the petitioner by a specified date. The court emphasized the lack of justification for withholding the substantial bank guarantee, as the penalty had been paid and there was no other financial liability against the petitioner.

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Issues:
Petition seeking mandamus for the release of original bank guarantee worth Rs.89 crore under FEMA provisions.

Analysis:
The petitioner filed a petition under Article 226 seeking direction against respondent No.2 to release the bank guarantee worth Rs.89 crore. The order imposed a penalty on the petitioner company and its director, which was paid during the pendency of the petition. The petitioner sought the return of the bank guarantee as there was no other liability against them. The Revenue opposed, citing a pending appeal with the Tribunal. The court noted that the penalty had been paid, and there was no justification for withholding the substantial bank guarantee. Hence, the court directed the Revenue to return the bank guarantee to the petitioner by a specified date.

This judgment revolves around the release of a bank guarantee under FEMA provisions. The petitioner sought the return of the bank guarantee worth Rs.89 crore after paying the imposed penalty. The Revenue opposed, citing a pending appeal with the Tribunal. The court found no reason to withhold the bank guarantee as the penalty had been paid, and there was no other financial liability against the petitioner. The court directed the Revenue to return the bank guarantee to the petitioner by a specified date, emphasizing the lack of justification for retaining it.

The court considered the petition seeking the release of the bank guarantee under FEMA provisions. The petitioner had paid the imposed penalty, and there was no other liability against them. The Revenue opposed, citing a pending appeal with the Tribunal. However, the court found no valid reason to withhold the bank guarantee, especially considering the substantial amount involved. As a result, the court directed the Revenue to return the bank guarantee to the petitioner by a specified date, emphasizing the lack of justification for retaining it during the appeal process.

In conclusion, the High Court directed the Revenue to return the original bank guarantee worth Rs.89 crore to the petitioner by a specified date. The court noted that the penalty had been paid, and there was no other financial liability against the petitioner. Emphasizing the lack of justification for withholding the substantial bank guarantee, the court ruled in favor of the petitioner, ordering the return of the bank guarantee.

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