Delhi High Court: ED Can Summon Women Under FEMA, CrPC Protection Not Applicable
Court says FEMA summons are civil in nature, governed by CPC not CrPC
Ruling clarifies ED’s powers to record statements of women in foreign exchange cases
By Our Legal Reporter
New Delhi: December 02, 2025:
In a significant ruling, the Delhi High Court has held that the Enforcement Directorate (ED) can summon women to its office for recording statements in proceedings under the Foreign Exchange Management Act (FEMA), 1999. The Court clarified that Section 160 of the Code of Criminal Procedure (CrPC), which prevents women from being compelled to appear at places other than their residence in criminal investigations, does not apply to FEMA summons.
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The judgment was delivered by Justice Neena Bansal Krishna in the case of Smt. Poonam Gahlot v. Directorate of Enforcement. The petitioner, a Canadian citizen, had challenged ED summons insisting on her personal appearance, arguing that she should be allowed representation through a lawyer and that Section 160 CrPC protected her from being summoned to the ED office.
Background of the Case
The petitioner received summons from the ED under Section 37 of FEMA, which empowers the agency to call individuals for discovery and production of evidence. She argued that:
- FEMA proceedings should be treated like criminal investigations.
- Section 160 CrPC should apply, allowing women to have statements recorded at their residence.
- She should be permitted to send a lawyer instead of appearing personally.
The ED opposed this, stating that FEMA proceedings are civil-administrative in nature, not criminal, and therefore CrPC protections do not apply.
Court’s Observations
The Delhi High Court dismissed the petition and made several key observations:
- Civil Nature of FEMA Summons: The Court held that summons under FEMA is governed by the Code of Civil Procedure (CPC), not the CrPC.
- Analogy with Income Tax Act: The Court compared FEMA powers under Section 37 to those under Section 131 of the Income Tax Act, which are civil in nature.
- Women Can Be Summoned: Since FEMA summons are not criminal proceedings, Section 160 CrPC protections do not apply. Women can be summoned to ED offices for recording statements.
- Personal Appearance Required: The Court rejected the plea to allow representation through a lawyer, emphasizing that personal appearance is necessary for discovery of evidence.
Legal Significance
This ruling has important implications for enforcement proceedings in India:
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- Clarifies FEMA’s Nature: The judgment distinguishes FEMA from criminal laws like the Prevention of Money Laundering Act (PMLA), which involve criminal investigations.
- Strengthens ED’s Powers: The ED can now summon women directly to its offices in FEMA cases, removing ambiguity about procedural safeguards.
- Limits CrPC Protections: Section 160 CrPC protections for women apply only in criminal investigations, not in civil-administrative proceedings like FEMA.
Wider Context
The ruling comes at a time when the ED has been increasingly active in investigating cases involving foreign exchange violations. FEMA proceedings often involve:
- Discovery of Evidence: Recording statements of individuals linked to foreign transactions.
- Civil Penalties: Unlike PMLA, FEMA violations usually result in monetary penalties, not imprisonment.
- Overlap with Other Laws: FEMA investigations sometimes run parallel to PMLA cases, leading to confusion about applicable procedures.
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By clarifying that FEMA summons is civil in nature, the Court has provided much-needed clarity for both enforcement agencies and individuals summoned.
Expert Views
Legal experts have welcomed the ruling as a clarification of procedural law. According to practitioners:
- The judgment ensures that ED’s powers under FEMA are not diluted by misapplication of criminal law safeguards.
- It reinforces the distinction between civil-administrative proceedings and criminal investigations.
- However, experts caution that ED must exercise its powers responsibly, ensuring that summons is not misused to harass individuals.
Impact on Women and Citizens
The ruling has direct implications for women summoned under FEMA:
- No Residence Protection: Women cannot insist on statements being recorded at their residence.
- Mandatory Personal Appearance: They must appear at ED offices when summoned.
- Equal Treatment: The judgment emphasizes that FEMA summons applies equally to men and women, as they are civil proceedings.
For citizens, the ruling underscores the importance of complying with FEMA summons and recognizing their civil nature.
Conclusion
The Delhi High Court’s ruling that ED can summon women to its office under FEMA marks a significant clarification in Indian procedural law. By holding that Section 160 CrPC protections do not apply, the Court has strengthened ED’s powers while distinguishing FEMA from criminal investigations.
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This judgment is expected to guide future cases, reduce confusion about procedural safeguards, and ensure smoother enforcement of foreign exchange laws. For individuals summoned under FEMA, compliance with ED summons is now legally mandatory, regardless of gender.
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