Kochi: Former Kerala Finance Minister Thomas Issac has approached the Kerala High Court challenging the summons issued by the Enforcement Directorate (ED) linked to the financial transactions of the Kerala Infrastructure Investment Fund Board (KIIFB) concerning the masala bonds case.
Justice Devan Ramachandran has sent notices to the involved parties and posted the matter for hearing on February 9. Standing Counsel for the ED, Jaishankar V Nair took notice for the ED (1st and 2nd respondents), Senior Advocate Sumathi Dandapani took notice for the Reserve Bank of India (3rd respondent) and Government Pleader took notice for the state government (4th respondent).
Senior Advocate Jaideep Gupta, appearing on behalf the Dr Issac submitted that the first summons was withdrawn by the ED pursuant to the orders of the Court and now a second summons was issued. Senior Advocate Arvind Datar, appearing on behalf of KIIFB submitted that the summons has been issued like a show cause notice and that it was issued without jurisdiction and has to be quashed. He thus sought a detailed hearing.
The Court also stated that the Additional Solicitor General of India (ASGI) ARL Sundaresan to submit pleadings on behalf of the ED. A fresh summon was also issued to KIIFB seeking the submission of documents and for taking oral evidence and the Court had directed the KIIFB to submit authenticated copies of documents sought by ED for conducting the investigation. Last week, the Court directed KIIFB to respond to the summons issued by ED.
Background
KIIFB and Dr Thomas Issac had filed separate petitions before the High Court challenging the issuance of the summons by the ED alleging violations of provisions under the Foreign Exchange Management Act (FEMA) for raising funds by issuing rupee-denominated bonds (masala bonds) abroad. In October 2022, Justice VG Arun stayed further issuance of summons against KIIFB and Dr Thomas Issac for two months.
Then, Justice Ramachandran permitted the issuance of fresh summons to Isaac and KIIFB, subject to further orders of the Court. This was later set aside by a Division Bench citing technical grounds, that that such a modification of an earlier Interim Order could not have been issued. In December last year, the ED withdrew the summons issued to the KIIFB and Dr Thomas Issac. On the above submission, Justice Ramachandran left open all the other issues since there were no pending proceedings.
