2026 INSC 727 (21 July 2026)
What the case was about
This case concerned two criminal complaints filed in 2002 under the Foreign Exchange Regulation Act, 1973 (FERA) against Standard Chartered Bank. The Enforcement Officer, Ministry of Home Affairs alleged that the bank had breached foreign-exchange rules while handling remittances in 1991–1992. After a Magistrate took cognizance and issued summons, the bank approached the Bombay High Court asking it to quash the proceedings under Section 482 of the Code of Criminal Procedure, 1973 (CrPC). The High Court refused, holding that the bank should have filed a revision petition under Section 397 CrPC instead. The Supreme Court therefore had to decide whether the High Court could block the quashing petition on that technical ground, and whether the prosecution had skipped a vital statutory step before launching the criminal case.
Key facts
Standard Chartered Bank, a banking company and authorised dealer in foreign exchange, was accused of facilitating remittances for a non-resident beneficiary in the United Kingdom. The prosecution’s case was that banker’s cheques and drafts procured in India through proxy purchasers were credited by the bank’s Mumbai branch to the benefit of Indo International Corporation Ltd., a person resident outside India. By allegedly doing so, the bank committed an offence of unauthorised credit to a non-resident, punishable under Section 56(1) of FERA. The bank subsequently reversed the entries, blocked Rs. 30,00,000/- in its own books, and surrendered the amount to the authorities.
Despite these events occurring in 1991–1992, a formal complaint under Sections 56(1) and 73(3) of FERA was lodged only on 30 May 2002. The bank filed quashing petitions under Section 482 CrPC before the Bombay High Court. By an order dated 22 March 2012 in Criminal Application Nos. 182–183 of 2012, the High Court dismissed the petitions, principally on the ground that an alternative remedy of criminal revision under Section 397 CrPC was available, rendering the Section 482 petitions non-maintainable.
Questions before the Court
The Supreme Court identified three issues for determination:
- Whether the High Court was correct in holding that the availability of an alternative remedy under Section 397 CrPC operates as a bar to a petition under Section 482 CrPC.
- Whether non-compliance with the mandatory requirement of an opportunity notice under the proviso to Section 61(2) of FERA warrants quashing of the criminal complaints and the summoning order.
- Whether the appellant’s fundamental right to a speedy trial under Article 21 of the Constitution was violated in the facts and circumstances of the case.
What the Court decided and why
The existence of a revisional remedy does not bar inherent jurisdiction
The Supreme Court held that the High Court erred in treating the availability of a revision under Section 397 CrPC as a threshold bar to exercising inherent jurisdiction under Section 482 CrPC. The two remedies operate in distinct spheres, and the mere existence of a revisional power cannot be read as ousting the jurisdiction preserved under Section 482, which exists to prevent abuse of process and to secure the ends of justice, subject only to self-restraint (para 14). The Court emphasised that the nomenclature of a petition is not determinative; in order to do substantive justice, the High Court may treat a petition filed under Section 482 as one under Section 397, and vice versa, rather than non-suiting a litigant on a hyper-technical point of maintainability (para 14). The Court further observed that the High Court’s dismissal of the bank’s applications rested on this threshold view on maintainability, and that the subsequent observation on delay did not displace that foundational reasoning.
Non-compliance with the FERA opportunity notice is fatal to the complaint
Turning to the merits, the Court examined the proviso to Section 61(2) of FERA, which stipulates that no court shall take cognizance of offences punishable under Sections 56 or 57 unless the accused has first been given an opportunity to show that he or she held the requisite permission. The Court held that service of this opportunity notice is a mandatory requirement, and that no complaint under Sections 56 or 57 can validly be instituted without compliance (para 21). Given the drastic penal consequences that follow from FERA proceedings, the opportunity must be meaningful and adequate, not merely technical or notional (para 21). The burden lies upon the prosecution to establish, at the threshold, that the notice was issued and served in the prescribed manner, and the Magistrate must satisfy himself of this compliance before taking cognizance (para 21).
In the present case, the prosecution had merely stated in the complaints that an opportunity notice was served upon the bank, but it never disclosed the date of the notice, nor placed a copy on record before the Magistrate (para 22). Even after the Supreme Court granted both parties an opportunity to file additional documents, the respondents failed to produce the alleged notice or any proof of service before the Magistrate, the High Court, or the Supreme Court (para 22). The Magistrate therefore took cognizance without recording satisfaction that the mandatory requirement under Section 61(2) had been met, and the High Court also ignored this issue altogether (para 22). The Court held that this rendered the cognizance and summoning order unsustainable and liable to be quashed (para 21; para 22).
The speedy-trial issue
The Court also framed the third issue regarding the alleged violation of the fundamental right to a speedy trial under Article 21, having regard to the long delay between the 1991–1992 transactions and the 2002 complaint. The available judgment text and structured holdings do not, however, contain a separate ruling on this issue.
Why it matters
This ruling reinforces two important pillars of criminal and economic law. First, it preserves the High Court’s ability to step in under Section 482 CrPC to prevent abuse of process and secure the ends of justice, even when a revision petition might also be available. The judgment discourages lower courts from rejecting quashing petitions on rigid, nomenclature-based technicalities and directs them to do substantive justice.
Second, the decision affirms that prosecutors cannot treat statutory pre-conditions as optional box-ticking exercises. Under FERA, the opportunity notice under Section 61(2) is a jurisdictional prerequisite, not a dispensable formality. The ruling places a clear burden on enforcement agencies to prove that such notices were issued and served, and it reminds magistrates that they must verify this compliance before issuing summons. Because the Court held the cognizance and summoning order unsustainable and liable to be quashed, the ruling terminates the defective process rather than returning it for further proceedings. This prevents enforcement authorities from bypassing statutory safeguards designed to ensure due process in economic offence prosecutions.
For banks, authorised dealers, and other entities facing prosecution under foreign-exchange and economic statutes, the judgment offers a vital safeguard against mechanical or defective criminal process that ignores mandatory statutory protections.