Appeals Against FERA Penalties Maintainable Under Criminal Appellate Jurisdiction: Calcutta High Court

The Calcutta High Court has held that appeals challenging penalties imposed for alleged contraventions under the Foreign Exchange Regulation Act, 1973 (FERA), can be entertained under its Criminal Appellate Jurisdiction, even though the appeals were filed under Section 35 of the Foreign Exchange Management Act, 1999 (FEMA).

Justice Ananya Bandyopadhyay overruled the Enforcement Directorate's preliminary objection that the appeals should have been filed before the Original Side Registry under the rules governing civil revenue appeals.

The Court held that the statutory savings provisions under Section 49 of FEMA, read with Section 6 of the General Clauses Act, 1897, preserve liabilities arising from contraventions under the repealed FERA regime. It observed that invoking Section 35 of FEMA as the procedural route for an appeal does not alter or extinguish the penal character of an adjudication originating under FERA.

The Court accordingly held that the four appeals challenging the orders imposing penalties of Rs. 2 lakh each were maintainable as criminal appeals. It directed that the matters be listed on December 11, 2026, for hearing on merits.

The Enforcement Directorate had argued that appeals under Section 35 of FEMA must be instituted before the Original Side Registry in accordance with Chapter XXXVIII, Part 20 of the Calcutta High Court Original Side Rules. It relied on the Special Bench decision in *Union of India v. Jagadish Prasad Nandalal*, which dealt with the procedure governing statutory appeals arising from civil revenue matters.

Opposing the objection, the appellants argued that the proceedings originated from alleged contraventions under FERA and that the liabilities and legal remedies arising under the repealed legislation continued to be protected by the statutory savings provisions.

The Court distinguished *Jagadish Prasad Nandalal*, observing that the decision concerned appeals arising from civil contraventions under FEMA and did not address penal adjudications originating under FERA whose liabilities were preserved by the savings provisions.

It also relied on the Supreme Court's decision in *M/s. P.V. Mohammad Barmay Sons v. Director of Enforcement*, which recognised the effect of statutory savings in preserving legal consequences and liabilities arising under the repealed FERA regime.

The Court further referred to the Delhi High Court's decision in *Rakesh Jain v. Union of India* and noted that appeals filed by co-accused MMTC Ltd. and B.C. Mallick against the same adjudication order had been entertained by the Delhi High Court under its Criminal Appellate Jurisdiction. Those appeals were allowed on merits, and the impugned orders were set aside.

Emphasising consistency in the treatment of challenges arising from the same penal adjudication, the Court held that the present appeals should likewise be entertained on the criminal appellate side.

The appeals arise from an adjudication order dated May 28, 2007, passed by the Special Director, Enforcement Directorate, imposing penalties of Rs. 2 lakh on the appellants. The Foreign Exchange Appellate Tribunal had dismissed their appeals on March 5, 2008, affirming the adjudication order.

The four appeals were filed by Barun Kumar Chattopadhyay, Chandranath Chatterjee, Pradyot Kumar Dutta and Gurupada Chowdhary against the Special Director, Enforcement Directorate.