Ignoring FERA summons a criminal offence: Apex court

Disobeying summons issued by an investigating agency under the money laundering law amounts to a criminal offence, the Supreme Court held on Thursday.

The SC order came as it set aside a Karnataka High Court order that had held that disobedience of summons for appearance did not amount to contravention of the provisions of the 1963 Foreign Exchange Regulation Act (FERA).

"In any event, the judgment of the High Court cannot be sustained as it is contrary to the law laid down by this court," a bench of justices SA Bobde and L Nageswara Rao said.

The bench passed the judgement on an appeal filed by the Enforcement Directorate (ED) challenging the high court order. Summons were issued under Section 40 of FERA in October 1997 directing three accused who were allegedly involved in releasing substantial foreign exchange in contravention of the law, to appear before ED officer, but they had failed to respond.

Thereafter, a complaint was filed against them in a court in Bangalore where one accused Mohammed Akram was represented by an advocate. The lower court, however, acquitted him and directed the other two to face the trial.

The trial court had held that the summons issued by ED were not duly served on the respondent personally and the refusal to appear before the enforcement officer in spite of summons under the provision of FERA, cannot be regarded as a contravention of the Act.