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CS Executive · Economic, Commercial and Intellectual Property Laws · Overseas Direct Investment

In a case under Section 13(1A) involving undisclosed foreign assets above the prescribed threshold, the Adjudicating Authority records reasons and recommends prosecution. Which statement correctly reflects the procedure and punishment in Section 13?

The Director of Enforcement, if satisfied and after recording reasons, may direct a criminal complaint by an officer not below Assistant Director. Punishment is imprisonment up to five years and fine, and courts cannot take cognizance except on that written complaint.

  1. AThe Director of Enforcement, if satisfied and after recording reasons, may direct a criminal complaint filed by an officer not below Assistant Director; imprisonment may extend to five years and fineCorrect
  2. BThe Adjudicating Authority directly files the complaint, and imprisonment may extend to two years
  3. CAny court may take cognizance suo motu, with imprisonment up to five years
  4. DProsecution is possible only on a complaint by the Reserve Bank, with fine only

Explanation

Section 13(1B) lets the Adjudicating Authority recommend prosecution and the Director of Enforcement, if satisfied, direct a complaint by an officer not below Assistant Director. Section 13(1C) prescribes imprisonment up to five years and fine, and 13(1D) bars cognizance except on such written complaint. The other options misstate the complainant, the term or cognizance.

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