FERA Penalty Appeals Maintainable as Criminal Appeals

Calcutta HC Upholds Jurisdiction Over FERA Penalty Appeals

In a significant ruling, the Calcutta High Court held that appeals against penalties imposed under the Foreign Exchange Regulation Act, 1973 (FERA) remain maintainable as criminal appeals even after FERA's repeal and replacement by the Foreign Exchange Management Act, 1999 (FEMA). The court clarified that the nature of proceedings under FERA being quasi-criminal in character, appellate courts retain jurisdiction to hear such matters despite the legislative shift to a civil framework under FEMA.

The petitioner had challenged a penalty order issued under FERA prior to its repeal, arguing that enforcement proceedings could not continue under a repealed statute. Rejecting this contention, the court observed that repeal of FERA did not extinguish pending liabilities or nullify proceedings initiated in good faith under the now-omitted law.

"The character of the proceeding at the time of initiation determines its maintainability,"

the court stated, emphasizing continuity in regulatory enforcement for pre-FEMA actions.

This decision has important implications for practitioners handling legacy foreign exchange disputes, confirming that statutory repeal does not automatically render enforcement proceedings invalid. Lawyers should assess jurisdictional and procedural continuity when defending or pursuing appeals in FERA-era cases, particularly where penalties or investigations were initiated before FEMA's enactment.