Martin Jebarathna Doss Antonisamy Vs Reserve Bank of India (Delhi High Court)
Delhi High Court dismissed the writ petition filed by Martin Jebarathna Doss Antonisamy challenging the Reserve Bank of India’s (RBI) compounding order dated August 19, 2024. The petitioner, an Overseas Citizen of India (OCI) and U.S. citizen, was fined ₹41,04,675 under the Foreign Exchange Management Act (FEMA), 1999, for purchasing agricultural land in Tamil Nadu without RBI approval. Despite complying with RBI’s directive to transfer the land to an eligible Indian resident, he contested the penalty as excessive. The court, however, found that the penalty was imposed per the prescribed FEMA guidelines and within the permissible limit of 300% of the contravention amount.
The petitioner had acquired the property for ₹13,68,225 and later sold it for ₹1.62 crore, leading to an additional penalty component based on undue gains. RBI determined the penalty using the Master Direction-Compounding of Contraventions framework, factoring in the duration of the violation (over 18 years) and the mode of payment. The petitioner was given an opportunity for a personal hearing but declined. The court ruled that the RBI followed due process and found no legal basis to challenge the penalty computation. Consequently, the petition was dismissed, affirming the penalty as fair and legally justified.
