Economic and Commercial Legislation
FEMA, 1999
FEMA divides transactions into current account (freely permitted) and capital account (regulated by RBI rules). Compliance is remembered as R-R-R: realisation of export proceeds, repatriation, and reporting through authorised dealer banks. Contravention is civil, not criminal: penalty under s.13 of up to three times the sum involved or ₹2 lakh, whichever is higher, with adjudication, appeal to the Appellate Tribunal and compounding.
PMLA, 2002
Section 3 covers concealment, possession, acquisition or projection of proceeds of crime; punishment is 3–7 years with fine. The Director may attach property provisionally for 180 days and the Adjudicating Authority confirms the attachment. Reporting entities must maintain KYC and five-year records. Appeals lie to the Appellate Tribunal.
IBC, 2016
The trigger is default of ₹1 crore or more. Financial creditors use s.7, operational creditors s.9 after a 10-day demand notice, and corporate debtors s.10. CIRP runs 180 days plus 90, with a 330-day outer limit including extensions. Section 14 imposes a moratorium; s.29A screens resolution applicants; ss.43–51 unwind preferential and undervalued transactions; s.53 sets the waterfall; s.54A provides pre-packaged insolvency for MSMEs.
Worked example. A supplier is owed ₹1.5 crore, unpaid for eight months. It issues a demand notice; if no payment and no pre-existing dispute is raised within 10 days, it files under s.9. A genuine pre-existing dispute is a complete defence.
Traps. Confusing the ₹1 crore default threshold with the earlier ₹1 lakh; treating FEMA breach as a criminal offence; forgetting the 330-day limit includes litigation.