Offence Liability of FERA is not solely dependent on the designation of the officer but also on his/her role in Company Affairs

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Last updated: 07 August 2020
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The Supreme Court has ruled that liability under the Foreign Exchange Regulation Act (FERA) is not determined solely by an officer's designation but by their actual role and responsibility in the company's business conduct. The court found that the appellant, a part-time, non-executive director, had not been given a fair opportunity to present his defence regarding his lack of responsibility for the company's actions. Consequently, the previous judgments imposing a penalty were set aside.

Court :
Supreme Court of India

Brief :
In the case of Shailendra Swarup vs. the Deputy Director, Enforcement Directorate, the Supreme Court bench comprising of Justice Ashok Bhushan, and Justice R. Subhash Reddy delivered a judgment stating that the proceedings complying with section 68 of Foreign Exchange Regulation Act, 1973 (FERA) depends upon the nature of role one plays in the affairs of the company or an organization and not only upon the designation or status in the company.

Citation :
SHAILENDRA SWARUP Vs THE DEPUTY DIRECTOR, ENFORCEMENT DIRECTORATE

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