Section 39 FEMA Act 1999 - Presumption as to Documents in Certain Cases

Section 39 of the Foreign Exchange Management Act, 1999 deals with evidentiary presumptions that may apply to specified documents when they are tendered in proceedings under FEMA.

In simple terms: when a document falls within Section 39 and is used as evidence in a FEMA proceeding, the court or Adjudicating Authority must apply the presumptions specified by the section, subject to the statutory conditions. Some of those presumptions can be displaced by proof to the contrary.

What does Section 39 of FEMA provide?

The provision applies where a document is produced, furnished or seized in the circumstances stated in the section, or where a duly authenticated document is received from outside India during investigation of an alleged FEMA contravention, and the document is tendered in evidence in a proceeding under the Act.

Text of Section 39 - Presumption as to documents in certain cases

39. Where any document-

(i) is produced or furnished by any person or has been seized from the custody or control of any person, in either case, under this Act or under any other law; or

(ii) has been received from any place outside India (duly authenticated by such authority or person and in such manner as may be prescribed) in the course of investigation of any contravention under this Act alleged to have been committed by any person,

and such document is tendered in any proceeding under this Act in evidence against him, or against him and any other person who is proceeded against jointly with him, the court or the Adjudicating Authority, as the case may be, shall-

(a) presume, unless the contrary is proved, that the signature and every other part of such document which purports to be in the handwriting of any particular person or which the court may reasonably assume to have been signed by, or to be in the handwriting of, any particular person, is in that person's handwriting, and in the case of a document executed or attested, that it was executed or attested by the person by whom it purports to have been so executed or attested;

(b) admit the document in evidence notwithstanding that it is not duly stamped, if such document is otherwise admissible in evidence;

(c) in a case falling under clause (i), also presume, unless the contrary is proved, the truth of the contents of such document.

Meaning and effect of Section 39

1. Documents produced, furnished or seized

Clause (i) covers a document produced or furnished by a person, as well as a document seized from a person's custody or control, whether the production, furnishing or seizure occurs under FEMA or under another law.

2. Documents received from outside India

Clause (ii) deals with a document received from a place outside India during investigation of an alleged contravention under FEMA. The document must be duly authenticated by the prescribed authority or person and in the prescribed manner.

3. Presumption about signature, handwriting, execution and attestation

Under clause (a), the court or Adjudicating Authority must presume the matters specified in the provision concerning signature, handwriting, execution or attestation unless the contrary is proved. The words "unless the contrary is proved" make this a rebuttable statutory presumption.

4. Insufficient stamping does not by itself bar admission

Clause (b) directs admission of the document notwithstanding that it is not duly stamped, provided the document is otherwise admissible in evidence. Section 39 therefore does not make an otherwise inadmissible document admissible merely because it falls within the provision.

5. Presumption as to truth of contents

Clause (c) is expressly confined to a case falling under clause (i). For such a document, the court or Adjudicating Authority must also presume the truth of its contents unless the contrary is proved.

Key conditions to check before applying Section 39

The material must be a document falling within clause (i) or clause (ii).
For clause (ii), the document received from outside India must satisfy the prescribed authentication requirement.
The document must be tendered in a proceeding under FEMA as evidence against the person concerned, or against that person and another person proceeded against jointly.
The presumption concerning truth of contents under clause (c) applies only to clause (i) documents.
The presumptions under clauses (a) and (c) are rebuttable because the statute expressly permits proof to the contrary.

Legal context: FEMA is the Foreign Exchange Management Act, 1999. The Directorate of Enforcement investigates suspected contraventions of foreign exchange laws and regulations under FEMA. Section 39 itself is an evidentiary provision and should be read with the facts of the particular proceeding and other applicable procedural and evidentiary law.

Related FEMA provisions

For the surrounding statutory scheme, see Section 37 - Power of search, seizure, etc., Section 38 - Empowering other officers and Section 40 - Suspension of operation of this Act.

This page is intended as a general legal reference. For a disputed FEMA proceeding, the application of Section 39 depends on the document, the manner in which it was obtained, the purpose for which it is tendered and the evidence produced in rebuttal.