Dubai based businessman Junaid Iqbal Mirchi is not facing any money laundering case but only a civil offence under Foreign Exchange Management Act (FEMA) 2000 in Delhi High Court which is a civil matter, said his lawyer in a communication to the Devdiscourse. The lawyer also argued that Mirchi's father Iqbal Mirchi was never prosecuted in any case of trading narcotics, therefore he could not be referred to as 'drug lord'.
Referring to a news published in Devdiscourse on April 11 regarding Delhi High Court setting aside Center's order to suspend his passport, the lawyer contended, "The learned judge has made it very clear that FEMA is civil legislation. The judgement also makes it evident that there is no scope for insisting personal appearance under the FEMA as there is no provision for custodial interrogation,". He further argued, "It is also relevant to note that in terms of section 10 (1) (e) of the Passport Act, a passport can be cancelled in cases where offence alleged to have been committed by the holder of passport is pending before a criminal court in India. "The reference to our client's father, the late Iqbal Memon (alias Mirchi) is defamatory. He has never been convicted in any offence relating to criminal dealings in narcotics, the Indian government's extradition proceedings against him in England failed and he had received a clean (clear) chit from the US Government regarding accusations that he was involved in trading of narcotics," claimed the lawyer.
In the order, he said the passport of Junaid Iqbal Mohammed Memon, a Non-Resident Indian (NRI) who has been residing permanently in UAE since 1993, could not have been suspended in public interest. It noted that the Memon had voluntarily agreed to appear by tele-conferencing and to make arrangements for it but that was not accepted by the agency. Justice Vibhu Bakhru relied on a judgement of the Delhi High Court division bench in Lalit Kumar Modi's case in which it was observed that Foreign Exchange Management Act (FEMA) did not entail custodial interrogation and, therefore, a request for an alternate mode of examination by video conferencing ought not to be shrugged aside.
"This court is of the view that the controversy involved in the present petition is covered by the decision of the division bench in Lalit Kumar Modi (supra) and the petitioner's (Memon) passport could not be suspended in public interest," the judge said. "The impugned order suspending the petitioner's passport is set aside. However, it is clarified that respondent no.3 (ED) is not precluded from initiating any other proceedings as permissible in law," the court said.
The court disposed of Memon's plea challenging the suspension of his passport by the Center in August 2015, on the ED's request to revoke the travel document for his refusing to join the investigation despite issuance of the summons. He had submitted that he has been carrying on business in property development and hospitality in UAE since 2011 and he was an NRI and not covered by the provisions of FEMA.
He claimed that the action of the authorities to impound his passport was arbitrary as it was not based on any relevant material and was completely contrary to the records. The ED had alleged that Memon has been involved in money laundering and has transferred the sale proceeds of assets in India, belonging to his late father to foreign countries.
Pursuant to these allegations, certain directives were issued to him by the agency and summons were issued asking him to appear in person. The authorities also contended that section 3 of the FEMA covers resident, non-resident and foreign nationals and various regulations of the Act are also applicable to NRIs.
He was called to furnish information in relation to four companies – Vantage Enterprises Pvt Ltd, Rock Stone Reality & Hotels Pvt Ltd, Realtors Hotels Projects Pvt Ltd and Horizon Estate Constructors Pvt Ltd. Though he had responded to ED's letters and also supplied the required documents, he failed to appear before it in person.
On September 22, 2015, the Consulate General of India, Dubai issued a letter suspending his passport for refusing to join the investigation carried out by the ED despite the issue of summons, which was challenged by him in the high court.