ORDER :

The present writ petition is filed challenging the order in SDE/SRO/HYZO/01/2023 dated 04.01.2023 passed by Respondent No. 1 herein under Section 16 of the Foreign Exchange Management Act, 1999 (hereinafter referred to as ‘the Act, 1999’).

2. Heard Dr. C.P. Ramaswami learned counsel for the Petitioners, Mr. V. Rama Krishna Reddy learned standing counsel for the Directorate of Enforcement appearing for the Respondent Nos. 1 and 2 and Sri Gadi Praveen Kumar, learned Deputy Solicitor General of India, appearing for respondent No.3. Perused the record.

Facts of the case:-

3. Alleging violations under Section 6(3)(b) of the Act, 1999 read with Regulation 5(1) of the Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations, 2000 (hereinafter referred to as ‘Regulations’) and violations under Sections 3(b) & 4 of the Act, 1999, a complaint bearing No. T-3/27/HZO/2011 dated 12.07.2017 was filed before the Directorate of Enforcement (hereinafter referred to as ‘ED’) under Section 16(3) of the Act, 1999.

4. Pursuant to the said complaint, a show cause notice dated 14.07.2017 was issued to the Petitioners herein who in turn submitted replies to the said show cause notice on 24.08.2021 and 25.08.2021. An oral hearing was conducted by Respondent No. 1 in which the Petitioners participated and submitted their written submissions. Thereafter, the impugned order dated 04.01.2023 was passed.

5. The Petitioners challenge the impugned order, inter alia, on the ground that they were charged under Section 6(3)(b) of the Act, 1999 which was subsequently omitted from the Act, 1999, w.e.f. 15.10.2019.

6. During the stage of admission, a preliminary objection was raised by Respondent No. 1 regarding the maintainability of the present writ petition. It was contended that the Petitioner has an efficacious alternative remedy under Section 19 of the Act, 1999. Therefore, on hearing the learned counsel for the parties, this court reserved the matter for orders to decide the preliminary objection of maintainability of the writ petition.

7. Since only the question of maintainability is to be decided, this Court deems it appropriate not to go into to the merits of the dispute and other contentions raised by the Petitioners herein.

8. Contentions of the Petitioners

i. The present writ petition is maintainable as the impugned order was passed without jurisdiction under Section 6(3) of the Act, 1999 which was subsequently omitted. Pending proceedings cease to exist under a provision that is omitted.

ii. Section 6 of the General Clauses Act, 1897 (hereinafter referred to as ‘the Act, 1897’) is not applicable to omissions and it only applicable to repeals. Reliance is placed on Rayala Corpn. (P) Ltd. v. Director of Enforcement, (1969) 2 SCC 412.

iii. Existence of an alternative remedy is not a bar to file a writ petition.

9. Contentions of Respondent Nos. 1 & 2

i. The present writ petition is not maintainable as the Petitioners have an efficacious and alternative remedy under Section 19 of the Act, 1999.

ii. Proceedings which are pending under a provision which is subsequently omitted do not cease to exist and are saved under Section 6 of the Act, 1897. Reliance is placed on Fibre Boards (P) Ltd. v. CIT, (2015) 10 SCC 333 and Shree Bhagwati Steel Rolling Mills v. CCE, (2016) 3 SCC 643.

Findings of the Court:-

10. As stated above, the only issue to be decided is whether the present writ petition is maintainable. It is trite law that a writ petition should not be entertained in case an efficacious alternative remedy is available. Where a statute provides for an appeal mechanism to impugn an order or any proceedings, a party cannot by-pass such mechanism by directly approaching the High Court under Article 226 of the Constitution of India. However, a party can approach the High Court directly against an order, if such order violates fundamental rights of the party before the court; or such order is passed without jurisdiction