New Delhi, Feb 21 (PTI) The Supreme Court today lifted astay on proceedings of Enforcement Directorate in a FEMA caseagainst the promoters and Directors of Uttar-Pradesh basedmanufacturer of two wheelers LML Ltd.
The apex court set aside the interim order passed by aDivision Bench of the Allahabad High court. On June 6, 2010,it had restrained ED, till further order, from carrying outinvestigations against LML Chairman and Managing DirectorSanjay Singhania and the company.A Bench comprising Justices M K Sharma and A R Dave alsoasked the High court to hear the matter afresh and decidewithin six weeks the petition filed by Singhania, challengingthe cases booked under FEMA (Foreign Exchange Management Act).
It asked the Chief Justice of the Allahabad High Court toeither list the matter before his bench or allocate it to thebench other than the one which had stayed ED''s proceedings.
A High Court vacation bench of Justices Rakesh Sharma andShyam Shankar Tiwari, had restrained ED from proceedingagainst the Kanpur-based company on the ground that Singhaniaregularly attended the proceedings and cooperated with theinvestigator for four years.
The apex court''s vacating the interim stay assumesimportance as the Directorate had reportedly intercepted phoneconversations between the industrialist and advocatesindicating that the Bench was fixed.
It was reported by a Delhi-based daily that the tappingwas done few days prior to the High Court''s interim order.
The Centre had challenged the order and sought directionsthat ED be allowed to go ahead with its investigations againstthe industrialist.
Singhania had approached the High Court, complainingthat ED had issued 17 notices and summons between January 2007to May 2010 in the cases of alleged violation of FEMA.
He had submitted he has been harassed and humiliated bythe entire exercise.
The High Court noted that the proceedings, initiated atthe instance of an official of LML, have virtually crippledthe company''s operations and it has been declared sick.
Singhania said he feared that LML''s scheme of revivalwould be derailed if such false and baseless allegationscontinued to haunt the Company, its Directors and promoters.
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