10,000 Firms Prosecuted Under Fera

Beating the May 31 deadline, the Enforcement Directorate has launched prosecutions against more than 10,000 companies in the past few days.

"The prosecutions have been launched within the guidelines," R K Pandey, deputy director of the directorate, told Business Standard. Officials of the Enforcement Directorate explained that it had filed 8,000 "certificates of action" for the attachment of properties under Section 70 of the Foreign Exchange Regulation Act (Fera), registered 2,000 cases for the recovery of penalty under Section 57 of Fera, and around 100 prosecution cases for non-compliance of summons. Prosecution has also been launched against another 270 companies and individuals for various offences under Fera.

"It was a Herculean task on the part of the directorate to file all these cases. Over 2,500 cases had to be reviewed, and prosecution against 270 companies, individuals and entities filed," Pandey said.

The task of filing prosecutions had to be expedited in the past month so as to book the culprits before the Fera was replaced, Pandey noted, adding that, "The review for all these cases began about six months ago." The issuances of 8,000 certificates of action empowers the district collectors to enforce the attachment of properties under Section 70 of Fera.

The complaints and prosecution proceedings have been filed in various courts of Mumbai. The directorate had to file complaints regarding all Fera cases by today, when the Act ceases to be in force, to be replaced by the Foreign Exchange Management Act from tomorrow. There were several cases pending in the Supreme Court, which had to be vacated for the Enforcement Directorate to launch action.

This was done over the past few months, enabling the directorate to finish off the mammoth task, Pandey said.