FERA repeal savings preserve investigation into pre-repeal offences, and Section 61 notice need only seek proof of permission

Repeal of FERA did not bar investigation into pre-repeal contraventions, because Section 49 of FEMA and Section 6 of the General Clauses Act preserved proceedings for earlier offences, subject only to the statutory limit on cognizance. The appointment and investigatory acts of the Enforcement Officer under FERA also remained valid for such pre-repeal matters, with no inconsistency shown between the repealed and later regimes for that purpose. The notice under Section 61(2) was held sufficient because it only had to give an opportunity to show existing permission; it was not required to operate as a full show-cause notice.

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Issues: (i) Whether investigation into contraventions under the repealed Foreign Exchange Regulation Act, 1973 could continue after the repeal in view of Section 49 of the Foreign Exchange Management Act, 1999 and Section 6 of the General Clauses Act, 1897; (ii) Whether the appointment and acts of the Enforcement Officer remained valid after repeal of the Foreign Exchange Regulation Act, 1973; (iii) Whether the opportunity notice issued under Section 61(2) of the Foreign Exchange Regulation Act, 1973 was legally sufficient so as to sustain the complaint.

Issue (i): Whether investigation into contraventions under the repealed Foreign Exchange Regulation Act, 1973 could continue after the repeal in view of Section 49 of the Foreign Exchange Management Act, 1999 and Section 6 of the General Clauses Act, 1897.

Analysis: The repeal provision in Section 49 of the Foreign Exchange Management Act, 1999 was read to save offences committed under the repealed Act, while limiting the bar on cognizance after the sunset period. The saving of repeal under Section 6 of the General Clauses Act, 1897 was held to apply because nothing in Section 49(5) displaced the continuance of investigation. The Court held that the saving clauses did not prohibit investigation after repeal and that the investigation could proceed as if the repealed Act had not been repealed, subject only to the statutory bar on cognizance after the prescribed period.

Conclusion: The challenge to continuation of investigation failed and the issue was decided against the petitioner.

Issue (ii): Whether the appointment and acts of the Enforcement Officer remained valid after repeal of the Foreign Exchange Regulation Act, 1973.

Analysis: The Court held that the appointment made under Section 4 of the Foreign Exchange Regulation Act, 1973 was not rendered invalid by the repeal and that the powers of the Enforcement Officer to investigate offences committed under the repealed Act continued. Section 49(5)(a) of the Foreign Exchange Management Act, 1999 was not treated as inconsistent with such appointment, and the later regime under the Foreign Exchange Management Act, 1999 was held to govern different acts committed after its commencement. No inconsistency was found between the two enactments for the purpose of investigating pre-repeal offences.

Conclusion: The challenge to the competency of the Enforcement Officer failed and the issue was decided against the petitioner.

Issue (iii): Whether the opportunity notice issued under Section 61(2) of the Foreign Exchange Regulation Act, 1973 was legally sufficient so as to sustain the complaint.

Analysis: The proviso to Section 61(2) was held to require only an opportunity to show the existence of permission where the alleged contravention was of a kind requiring prior permission. The notice issued gave the accused an opportunity to produce permission from the Reserve Bank of India, and the reply did not assert possession of such permission. The Court further held that the notice is not a full show-cause notice, that the complainant was not bound at that stage to accept the defence on merits, and that the material showed consideration of the reply before filing the complaint. The short time given in the notice did not invalidate the proceedings in the absence of any assertion that the requisite permission existed.

Conclusion: The notice was held to be legally sufficient and the issue was decided against the petitioner.

Final Conclusion: The petition under Section 482 of the Code of Criminal Procedure, 1973 was found to be devoid of merit, with all three substantive challenges rejected and the criminal complaint left intact.

Ratio Decidendi: Section 49 of the Foreign Exchange Management Act, 1999 and Section 6 of the General Clauses Act, 1897 preserve investigation into pre-repeal offences under the Foreign Exchange Regulation Act, 1973, and the proviso to Section 61(2) of the Foreign Exchange Regulation Act, 1973 requires only an opportunity to show existing permission, not a full pre-prosecution adjudication.

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