A foreign national cannot hold any immovable property situate in India unless he had obtained prior sanction of the Reserve Bank or made a declaration that he was already holding such property at the time of the commencement of the Act.

JUDGMENT - G.F. COUTO, J.:---The petitioner is a foreign national and not a citizen of India. He challenges the judgement dated 28th January, 1986, passed by the learned District Judge, South Goa, confirming the order dated 21st December, 1984, made by the Civil Judge, (Junior Division), Margao, dismissing the application for injunction filed by him.

2. The petitioner filed a suit seeking mandatory and perpetual injunctions against the respondents herein on the grounds that he is the co-owner in possession of the property known as "Govuncatem" and that the first respondent started laying foundation for a construction in the said property without any right therefore. The suit so filed was resisted by the respondents on several grounds, namely, on the ground that the plaintiff is not a citizen of India and as such, he cannot hold or acquire any immovable property in India unless he had obtained or is deemed to have obtained permission from the Reserve Bank of India to hold or acquire such property. Therefore, according to the respondents, the plaintiff / petitioner could not legally hold any property in India unless he had been permitted by the Reserve Bank under the provisions of section 31 of the Foreign Exchange Regulation Act, 1973 (for short "the Act"). It is further the case of the respondents that the petitioner was not in actual possession of the suit property at least since the time of the Liberation of Goa. Along with the plaint, the petitioner filed an application seeking a temporary injunction restraining the respondents from carrying on any such further construction work in the said property or from interfering in any manner with it during the pendency of the suit. The sought injunction was granted ex parte by the order dated 5th October, 1984, but the same injunction was vacated by the learned Civil Judge, (Junior Division), Margao by his order dated 21st December, 1984, on the grounds that admittedly the petitioner is a foreign national and he has not complied with the provisions of section 31 of the Act and, therefore, he was not entitled or he should not be deemed to be holding any immovable property in this Territory, as well as on the ground that the petitioner was not in actual possession of the property. Being aggrieved, the petitioner approached the District Court, South Goa, with an appeal which was dismissed by the impugned judgement dated 28th January, 1986.

3. The petitioner challenges the aforesaid judgment of the District Judge on several grounds, but his main thrust against the said judgment is that the lower Appellate Court had committed an error in exercise of jurisdiction by heavily relying on the provision of section 31 of the Act to reach a finding that the petitioner is not the owner and /or is not in possession of the suit property since he failed to make a declaration or to comply with the provision of sub-section (4) of section 31 of the Act. Secondly, it is the case of the petitioner that section 31 of the Act does not come in any manner in his way, for he was already holding the suit property and under the Act those rights are not taken away.

4. Elaborating the above grounds, Shri Dessai, the learned Counsel appearing for the petitioner, contended that as can be seen from the preamble to the Act, the same was enacted to consolidate and amend the law regulating certain payments, dealings in foreign exchange and securities, transactions indirectly affecting foreign exchange and the import and export of currency and bullion, for the conservation of the foreign exchange resources of the country and the proper utilisation thereof in the interests of the economic development of the country. This being the scope and purpose of the Act it is manifest that the provisions of the Act are not meant to deprive a person from his rights and from his property. Now, according to the learned Counsel, section 31 of the Act imposes some restrictions on acquisition holding, etc., immovable property in India by

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