Mohammad Iqbal Siddiqi Vs Special Director Directorate of Enforcement (Appellate Tribunal Under Safema At Delhi)
Introduction
The Appellate Tribunal under SAFEMA, New Delhi, in Shri Mohammad Iqbal Siddiqi v. Directorate of Enforcement, Kolkata (FPA-FE-17/KOL/2017), delivered a significant ruling on 29 September 2025 clarifying that under the Foreign Exchange Management Act, 1999 (FEMA), the purpose for which an NRI intends to use agricultural land is immaterial in determining contravention. The legal character of the land, as recorded in government revenue records, governs compliance. Even if the land is intended for a non-agricultural venture such as poultry or dairy farming, it remains agricultural until officially converted.
Facts of the Case
The appellant, Shri Mohammad Iqbal Siddiqi, a Non-Resident Indian, purchased land situated at Pargana Deva Gram, District Barabanki (U.P.). The property was classified as agricultural land in government records. The Enforcement Directorate initiated proceedings under FEMA, alleging that the acquisition violated Section 6(3)(i) and the related regulations prohibiting NRIs from acquiring agricultural land, farmhouses, or plantation properties in India.
The appellant contended that the purchase was made from lawfully earned foreign income during his employment abroad. He further stated that the land was not intended for cultivation but for developing a poultry and dairy farm, and therefore should not attract FEMA restrictions. He also argued that Section 6(3) had been omitted by the Finance Act, 2015, notified on 14 May 2015, and since the complaint and show cause notice were issued on 22 May 2015, the proceedings were invalid. Additionally, the penalty of ₹15,00,000 and confiscation of the land were said to be excessive and disproportionate.
