Kerala: After Thomas Isaac, LDF MLAs, KIIFB also moves HC challenging ED summons in KIIFB transactions

While KIIFB is the first petitioner in the case, its CEO KM Abraham and joint fund manager Ani Jula Thomas have also joined the petition as second and third petitioners.

"The Masala Bonds were issued with the appropriate clearance of the RBI for generating funds for performing development initiatives in Kerala. Only the RBI can look into any Foreign Exchange Management Act (FEMA) violations with regard to the issuing of bonds denominated in rupees, and the ED is not authorized to look into the issue of Masala Bonds," the plea contended.

Beginning in March 2021, shortly after the Election Council of India announced the local assembly elections, the ED issued a number of summonses, and KIIFB officials--from the CEO to other officers--appeared for questioning on multiple occasions.

Although the investigation has been ongoing for over one and half years, the ED has yet to file a complaint alleging violations as required by Section 16(3) of the FEMA.

On August 1, the ED again issued another summons. During oral submissions, ED representatives treated the third petitioner in an aggressive and irritable manner, the plea said.

"The summonses issued by the ED state that this action leads to the unavoidable suspicion that the current investigation into the affairs of KIIFB, launched by the 1st Respondent, is a component of a planned smear campaign, sustained by vested political interests, to undermine the state government apparatus," the plea stated.

The plea further said the petitioners would suffer severe, irreparable harm if the impugned summonses were upheld since.

Thomas Issac previously petitioned the High Court after receiving a summons, and his plea was posted on the 18th of this month in anticipation of the Central Government Counsel's response (CGC). Isaac also filed a motion with the Kerala High Court to overturn the prior summons. (ANI)