Delhi High Court Seeks Centre's Response On Plea For "Uniform Banking Code" To Regulate Foreign Exchange Transactions

The plea states that a uniform Code will help in controlling black money generation and benami transactions.

The Division Bench of Acting Chief Justice Vipin Sanghi and Justice Navin Chawla has issued notices to Ministry of Home Affairs, Ministry of Law & Justice and Ministry of Finance.

The Respondents have been asked to examine the matter and file a reply/ status report within 4 weeks.

"These are some serious issues and require detailed consideration. We will examine the documents...," ASG Chetan Sharma said.

Accordingly, the Court directed the Petitioner to redact the names and share the documents with the government.

The Petitioner has pointed out several loopholes in the system with regard to transfer of foreign funds in Indian banks, which as per him could be used by separatists, naxals, and radical organizations operating to destabilize the country.

He submitted that money is transferred into Indian bank accounts by any foreign source by way of RTGs, NEFT, IMPS, which are tools meant for transfer of funds within the country.

He urged that International Money Transfer is the only mode which should be permitted to be utilized for transfer of funds from foreign sources in Indian bank accounts as it will leave a stamp with regard to identify and source of the funds.

"To track black money route, the Centre must take steps to ensure that foreign exchange transaction is not done without giving Full Name, PAN, AADHAAR, Mobile and AADHAAR details of depositor and drawer.

Similarly, Centre must make it compulsory to have Electronic Fund Transfer at Point of Sale (EFTPOS) or Mobile Phone Payment System (MPPS) for manufacturers distributors retailers and services providers to control black money generation," the plea urges.

It is submitted that Foreign Inward Remittance Certificate (FIRC) must be issued and All International and Indian banks must send the link through SMS to get FIRC automatically in case Foreign Exchange is being deposited in the account as converted INR.

Moreover, only a person or company should be permitted to send Indian Rupees from one bank account to another bank account inside the territory of India through the RTGS, NEFT and IMPS and International Bank should not be allowed to use these domestic banking transaction tools.

As per the Petitioner, the Prayers will control the menace of bribery, black money, benami transaction, tax evasion, money laundering, profiteering, grain hoarding, etc. It will also control mafias activities including land mafias, drug mafias, liquor mafias, mining mafias, gold mafias, transfer-posting mafias, betting mafias, hawala mafias, etc.

Case Title: Ashwini Kumar Upadhyay v. Union of India