In a landmark decision that reinforces judicial scrutiny of regulatory overreach, the Karnataka High Court has decisively quashed the Foreign Exchange Management Act (FEMA), 1999, proceedings initiated by the Enforcement Directorate (ED) against Greenpeace Environment Trust.
The Trust faced allegations under Section 6(3)(b) of FEMA concerning purported irregularities in foreign exchange transactions, resulting in a contentious legal confrontation. Greenpeace vigorously contested the ED’s claims, asserting that the show-cause notice issued against them was baseless, arbitrary, and lacked the necessary factual foundation.
After thoroughly evaluating the legal submissions and factual evidence, the High Court concluded that the ED had failed to substantiate its allegations with clear and credible evidence. Highlighting the importance of procedural fairness and robust evidentiary standards in regulatory actions, the Court decisively set aside the ED’s notice, providing much-needed relief to Greenpeace Environment Trust.
This judgment stands as a crucial precedent, emphasising that regulatory agencies must ensure rigorous due diligence before initiating enforcement actions, especially against organisations advocating environmental protection and transparency. The ruling further bolsters India’s commitment to protecting legitimate activism from unjustified administrative interference, safeguarding the vital role of civil society in promoting environmental sustainability and accountability.