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The Enforcement Officer v. Mohammed Akram

Criminal Appeal · 2017 INSC 764Decided 17 Aug 2017
Criminal Appeal Nos. 1422-1423 of 2017
Justice S.A. Bobde · Justice L. Nageswara Rao

Background

The Enforcement Directorate accused Mohammed Akram of involvement in the illegal release of about Rs. 50 crore in foreign exchange by an authorised money changer, and issued him a summons under Section 40 of the Foreign Exchange Regulation Act (FERA), 1973 to appear for questioning. He did not respond to the summons, and a criminal complaint was filed against him for this failure under Section 56 of FERA. The Special Court acquitted him, holding the summons was never validly served and that merely failing to appear was not itself an offence under the Act, and the Karnataka High Court upheld that acquittal following an earlier Kerala High Court ruling.

Decision Breakdown

The Supreme Court allowed the Enforcement Officer's appeal and set aside the High Court's judgment. It held that the question of whether disobeying a Section 40 summons amounts to an offence under Section 56 of FERA was already settled by a three-judge bench in Enforcement Director v. M. Samba Siva Rao (2000), which held that failing to obey such a summons does constitute a punishable contravention of the Act, regardless of whether a specific sum of money was involved. The Court also noted that the service-of-summons issue was no longer relevant since the respondent had been represented by an advocate before the trial court, so he clearly knew of the proceedings.

Lesson Learnt

Ignoring an official summons issued by an investigating authority like the Enforcement Directorate is not a safe or cost-free option: courts treat such disobedience itself as a punishable offence under the relevant law, independent of whether the underlying transaction is later proven.

Official source (sci.gov.in)View Judgment (PDF)

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