The former State Finance Minister was recently summoned again by the Enforcement Directorate (ED) regarding the masala bonds case.
Thank you for reading this post, don't forget to subscribe!
Today (19 Feb 2024), at the Kerala High Court, former Finance Minister Thomas Isaac has stated his willingness to appear before the Enforcement Directorate (ED) on the condition that the summons explicitly outlines the allegations against him. This case has garnered significant attention, highlighting the ongoing scrutiny under the Foreign Exchange Management Act (FEMA) concerning the Kerala Infrastructure Investment Fund Board’s (KIIFB) issuance of ‘Masala Bonds’.
The submission was made Today in response to a suggestion made by Justice Devan Ramachandran last week.
Senior Advocate Arvind Datar, representing KIIFB, emphasized the readiness of the board’s officials to cooperate with the ED’s investigation. However, Datar stipulated a unique condition for their compliance: the interrogation process must be conducted under the vigilant oversight of the court and be recorded. This request underscores the need for transparency and fairness in the investigative process, ensuring that the proceedings are conducted without any bias or undue pressure.
Datar further specified that the initial summons was directed at the CEO of KIIFB, proposing instead that the Deputy General Manager (DGM), Ajosh Krishnakumar, along with two or three other officials knowledgeable about the relevant transactions, attend the interrogation. This strategic move suggests a phased approach to the investigation, allowing for a broader understanding of the matter before potentially involving higher-level executives.
The court, acknowledging Datar’s proposal, has scheduled the appearance of the suggested KIIFB officials before the ED on March 27 and 28. This decision marks a significant step in the ongoing investigation, setting the stage for a detailed examination of the allegations related to the issuance of Masala Bonds by KIIFB.
The controversy centers around the petitions filed by Isaac and KIIFB officials in 2022, challenging the ED’s summons. These petitions raise critical questions about the legal and procedural aspects of the ED’s investigation, particularly concerning the alleged violations of FEMA in the issuance of Masala Bonds. Masala Bonds are rupee-denominated bonds issued outside India by Indian entities, a financial instrument that has been under the scanner for potential regulatory breaches.
This case is a pivotal moment for the enforcement of financial regulations in India, highlighting the intricate balance between promoting investment and ensuring compliance with the legal framework. As the Kerala High Court continues to navigate through the complexities of this case, the outcomes will undoubtedly have far-reaching implications for the regulatory landscape and the operational freedom of Indian entities in the global market.
The matter will be heard next on March 7.
FOLLOW US ON YOUTUBE FOR MORE LEGAL UPDATES
