Summons Under FEMA Are Civil in Nature – Section 160 CrPC Has No Role to Play: Delhi High Court Denies Exemption to Woman Petitioner from Personal Appearance Before ED

“Enforcement Directorate Officers Exercise Powers Analogous to Civil Courts Under FEMA — No Right to Insist That Statement Be Recorded at Home Merely Because the Person is a Woman”, In a ruling that clarifies the scope of procedural protections available under the Code of Criminal Procedure (CrPC) vis-à-vis proceedings under the Foreign Exchange Management Act (FEMA), the Delhi High Court dismissed a writ petition filed by Smt. Poonam Gahllot, who had challenged summons issued by the Enforcement Directorate (ED) under Section 37 of FEMA, seeking her personal appearance for recording of her statement.

The Court, in a judgment authored by Justice Neena Bansal Krishna, firmly held that “Section 160 CrPC — which prohibits summoning a woman outside her residence — has no applicability to proceedings under FEMA,” since FEMA proceedings are regulatory and civil in nature, not criminal in character. The Court emphasized that Section 37 of FEMA read with Section 131 of the Income Tax Act empowers the ED to summon persons and record statements under powers akin to civil courts, governed by the Code of Civil Procedure (CPC), not the CrPC.

FEMA Proceedings Are Not Criminal — They Do Not Trigger Safeguards Like Section 160 CrPC

The central issue before the Court was whether the ED could compel a woman to appear in person at its office for recording her statement under FEMA, or whether she was entitled to protection under Section 160(1) CrPC, which exempts women from being summoned outside their place of residence.

The Court held that such exemption does not apply in the context of summons under Section 37 of FEMA. In para 42, the Court observed:

“Powers regarding discovery and production of evidence under Section 37 FEMA are analogous to those under Section 131 of the Income Tax Act, which is governed by the Civil Code, and therefore Section 160 CrPC would not be applicable.”

The Court explained that FEMA proceedings do not involve any ‘offence’ or ‘accusation’ at the initial stage. Unlike PMLA proceedings that carry criminal consequences and where Section 50 has been held to override CrPC protections, FEMA proceedings are limited to administrative contraventions punishable with monetary penalties, not criminal prosecution.

Petitioner Cannot Demand That Statement Be Recorded at Her Home Solely on Gender Grounds

The petitioner, a 53-year-old Canadian citizen, had challenged three separate summons issued in November and December 2018, asserting that as a woman, she could not be compelled to appear at the ED office. Her counsel relied heavily on Section 160 CrPC and the decision in Nandini Satpathy v. P.L. Dani (1978) 2 SCC 424, to argue that recording of statements at the ED office would violate constitutional protections under Articles 20 and 21.

However, the High Court drew a critical distinction between CrPC protections afforded in criminal investigations and CPC-governed regulatory inquiries under FEMA, clarifying that:

“Civil Code contains no provision like Section 160 CrPC mandating the recording of the statement of a woman at her residence. The insistence of the petitioner for not appearing before the authority is therefore without any basis.” [Para 43]

The Court also rejected the petitioner’s argument that the ED must provide all documents forming the basis of summons, observing that the issuance of summons under Section 37 FEMA is part of preliminary inquiry, and does not trigger full-fledged trial rights or constitutional infringements.

FEMA’s Framework is Distinct from PMLA — Reliance on PMLA Judgments Misplaced

The Court took care to distinguish FEMA from the more stringent Prevention of Money Laundering Act (PMLA), noting that the powers conferred on ED under PMLA, especially under Section 50, carry criminal consequences and allow for overriding of CrPC safeguards in certain circumstances. However, such powers are not extended to FEMA.

Justice Bansal Krishna referred to the Supreme Court’s ruling in Abhishek Banerjee v. ED (SLP (Crl.) Nos. 2806-2807/2022), clarifying that the ED’s powers under FEMA do not flow from PMLA jurisprudence, and the analogy drawn by the petitioner was legally untenable:

“FEMA and PMLA have distinct statutory frameworks and nature of proceedings. Section 50 PMLA confers criminal investigative powers, whereas Section 37 FEMA remains within the civil inquiry domain.” [Para 41]

FEMA Summons Governed by Section 131 IT Act – Civil Courts’ Powers Apply

Crucially, the Court laid down that Section 37(3) of FEMA incorporates the powers under Section 131 of the Income Tax Act, which in turn draws from the Code of Civil Procedure. Section 131 gives ED officers the same powers as civil courts for compelling attendance and requiring production of documents. Thus, when the ED summons a person under FEMA for these purposes, they act not as police officers conducting criminal investigations but as civil regulatory authorities, and such proceedings do not attract the safeguards of the CrPC.

The Court clarified:

“The power to seek discovery, ensuring the attendance of the person for examining him on oath, and for compelling production of documents, is distinct from the powers of search and seizure, which alone may attract CrPC.” [Para 36]

Request to Quash Summons and Shift Proceedings to Petitioner’s Residence Rejected

The petitioner had repeatedly requested that her statement be recorded at her residence, relying on the Delhi High Court’s earlier decision in Asmita Agrawal v. ED, (2002) 61 DRJ 339. The ED, however, rejected her request citing the Madras High Court judgment in Nalini Chidambaram v. ED, and proceeded to issue a final summons.

The Delhi High Court, in the present ruling, upheld the ED’s stance, noting that: “Summons for the production of evidence and for recording of a statement under Section 37 FEMA read with Section 131 IT Act clearly fall within the civil jurisdiction. There is no violation of Articles 20 or 21 merely by issuance of summons requiring personal appearance.” [Para 43]

No Exemption for Women Under FEMA Summons — Civil Process Must Be Respected

Dismissing the writ petition, the Court observed: “There is no merit in the petition. The summons issued under Section 37 of FEMA are valid and do not attract Section 160 CrPC or any constitutional infirmity. The petitioner is required to appear personally as directed.” [Para 45]

This decision sends a strong signal to practitioners representing clients in FEMA proceedings that civil-regulatory inquiries under FEMA do not attract the procedural protections of criminal law, and requests for gender-based exemption under Section 160 CrPC are not legally tenable.

Date of Decision:1 December 2025