Jose Colaco asks: 1: Do guidelines (as in the RBI guidelines) constitute the law?
2: What if the property was purchased before the FEMA, 1999.came into effect? Response: 1. Guidelines have the binding force of law. 2. FEMA, 1999 is the successor to FERA,1973. FERA was far more stringent as compared to FEMA which was watered down quite a bit. I will need to research and come back. Eddie Fernandes: Marshall has drawn our attention to two "guidelines" ? one of 1 July 2013 and the other of 2 June 2012. As far as I am aware all the cases before the Enforcement Directorate were handed to them BEFORE Marshall?s earliest date! Response: If Eddie could kindly indicate the period covering the cases before the ED, I could perhaps research and revert with the factual legal position then. However, as I have stated above, the predecessor of FEMA, FERA, 1973 was very stringent and there is an extremely remote possibility that it could have permitted foreigners from buying immoveable property. This was the era when MNC's had to dilute their stake in their Indian subsidiaries to below 50%. When Banks and Insurance companies were nationalised, When the Urban Land Ceiling Act and MRTP Act came into force. Regards, Marshall
