'Deserves Detailed Hearing': Delhi High Court Seeks RBI's Response On PIL Seeking 'Uniform Banking Code' To Regulate Foreign Exchange Transactions

The Delhi High Court on Monday sought response of the Reserve Bank of India (RBI) in a public interest litigation moved by Advocate and BJP leader Ashwini Kumar Upadhyay, seeking implementation of a "Uniform Banking Code" for Foreign Exchange Transactions.

Observing that the matter deserves a detailed hearing, a division bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad issued notice to RBI and ordered that the complete set of documents of the plea be handed over to its standing counsel.

Additional Solicitor General Chetan Sharma appearing for Centre submitted that the plea raises a serious issue which requires detailed examination. The court thus granted six weeks time to the Centre for filing its response in the matter.

The plea states that a uniform Code will help in controlling black money generation and benami transactions.

Upadhyay in the plea has pointed out "several loopholes" in the existing system of transfer of foreign funds in Indian banks, which as per him could be used by "separatists, naxals, and radical organisations to destabilise" the country.

He submitted that money is transferred into Indian bank accounts by any foreign source by way of RTGs, NEFT, IMPS. He urged that International Money Transfer is the only mode which should be permitted to be utilized for transfer of funds from foreign sources in Indian bank accounts as it will leave a stamp with regard to identify and source of the funds.

"To track black money route, the Centre must take steps to ensure that foreign exchange transaction is not done without giving Full Name, PAN, AADHAAR, Mobile and AADHAAR details of depositor and drawer," Upadhyay submitted.

Similarly, Centre must make it compulsory to have Electronic Fund Transfer at Point of Sale (EFTPOS) or Mobile Phone Payment System (MPPS) for manufacturers, distributors, retailers and services providers to control black money generation, the plea argues.

It is also submitted that Foreign Inward Remittance Certificate (FIRC) must be issued and all International and Indian banks must send the link through SMS to get Foreign Inward Remittance Certificate automatically in case Foreign Exchange is being deposited in the account as converted INR.

As per Upadhyay, the reliefs sought in his plea will control the menace of bribery, black money, benami transaction, tax evasion, money laundering, profiteering, grain hoarding, etc.

It will also control mafias activities including land mafias, drug mafias, liquor mafias, mining mafias, gold mafias, transfer-posting mafias, betting mafias, hawala mafias, etc, the plea states.

Case Title: Ashwini Kumar Upadhyay v. Union of India