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FEMA - Case Laws

Showing 1 to 4 of 4 Records

• 2016 (9) TMI 1352 - APPELLATE TRIBUNAL FOR FOREIGN EXCHANGE, NEW DELHI
  

  Contravention of Section 3(d) r/w Section 42(1)(2) of FEMA, 1999 - search - payments in foreign exchange - Held that:- No foreign currency has been recovered. There is no corroboration evidence of the fact that the payments allegedly made by the appellants were made as per the instructions from abroad. There is no evidence available to establish that the payments so made were in consideration of foreign exchange so acquired by the appellant companies towards the differential amount of alleged under-invoicing of imports made by the above said two companies. The appellants are stated to be involved in import of MS Ingots/Scrap from abroad, therefore, for this they were supposed to make payments in foreign exchange. It has not been explained in the Adjudication Order as to what benefit did the appellant gain by under-invoicing and payment in Indian currency by the appellants at the behest of sellers abroad as has been alleged.

  There are discrepancies, contradictions and vagueness apart from non-adherence to the principles of natural justice affecting the process of fair trial. The case laws relied upon by the ld. CA are on the value of retracted confession and it has been held by the Hon’ble Supreme Court in Vinod Solanki v. UOI [2008 (12) TMI 31 - SUPREME COURT] that the burden is on the prosecution to show that the confession is voluntary in nature and not obtained as the outcome of threat, etc. In Piyush Saxena v. Enforcement Directorate [2009 (12) TMI 514 - HIGH COURT OF DELHI] has held that once the retraction of a confessional statement takes place the burden to prove that the statement was voluntary is on the prosecution. While in Vinod Kumar Sahadev v. UOI [2009 (12) TMI 514 - HIGH COURT OF DELHI] held that once the alleged statement was retracted the allegations of force and duress the onus to prove that the statement was voluntary shifts to the Government. The statement of the two noticees lose their sanctity in view of the retraction on the very next day and which was illegally rejected by the Investigating Officer and the Adjudicating Authority without any discussion or consideration relied on the rejection by the Investigating Authority and did not examine the veracity of the statements. In view of the above discussions the impugned order is devoid of merits and cannot stand judicial scrutiny resultantly appeals are liable to be allowed and the impugned order is liable to be set aside.

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• 2016 (9) TMI 1344 - APPELLATE TRIBUNAL FOR FOREIGN EXCHANGE, NEW DELHI
  

  Guilty under Sections 18(2) and 18(3) read with Section 58 of FERA, 1973 - liability by a deeming fiction - criminal liability fastened against in charge and responsible for the conduct of the business of the company - Held that:- No evidence has been lead by the Enforcement Directorate in the Adjudication Proceedings to the effect that the respondents were in-charge and were responsible for the conduct of the business of the company. Vicarious liability as has been held by the Hon’ble Supreme Court can only be inferred against the company for the requisite statements in the complaint are made so as to make accused therein vicariously liable for offence committed by company along with averments in a petition contending that accused were in-charge of and responsible for the business of the company and by virtue of their position they are liable to be proceeded with. No vicarious liability on the part of the respondents herein has been pleaded and proved, therefore, vicarious liability cannot be inferred ipso facto by the Adjudicating Authority. We do not find any latent or patent illegality, irregularity or infirmity in the Adjudication Order. The Revision in our opinion has no merits and is liable to be dismissed.

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• 2016 (9) TMI 352 - FOREIGN EXCHANGE TRIBUNAL
  

  Proceedings leveled against co-noticee - appellant was resident outside India - Held that:- Nothing incriminating from the raid carried out at the residential and business premises of the appellant could be found. There is no documentary evidence in support of the allegations of the respondent. There is no evidence on record to show that the appellant was involved in any act of alleged purchase and sale of foreign currency. For the alleged credits in banks the bankers or any of the alleged recipient of the gift cheques etc. none of the said bankers or alleged recipients have identified the appellant. We are also of the view that there appears to be breach of principles of natural justice as only three dates in the entire Adjudication Proceedings were fixed in 1999 and the Impugned judgment was passed on 30-08-1999 ex-parte. There is no report: to the effect that the appellant was duly informed of the three dated fixed for the Adjudication Proceedings.

  Thus in our considered view it is a case where adequate opportunity to defend was not afforded to the appellant. The proceedings were concluded within a span of six months while in another matter with identical allegations for the alleged breach by the same Adjudicating Authority, proceedings against the appellant were dropped. We are in agreement with the Ld. counsel for the appellant that proper application of judicial mind has not been made effected while deciding the proceedings and the Adjudicating Authority was not clear about the role of the appellant in the Impugned Order. He has at several occasions wrongly mentioned noticee number of the appellant to be notice No. l instead of noticee No.2. It is also relevant to mention that opportunity for personal hearing was given on 23-03-1999 while the same Adjudicating Authority fixed 24-03-1999 in connection with SCN No. T-4/2/B/96 dated 24-03-1994. The evidence of hand writing expert as per settled legal position Is a mere opinion, however, it carries some weight and the appellant had filed a report denying that the disputed writing was not in his hand. It may also be mentioned here that the standard of proof under FERA was more stringent as compared to proceedings under FEMA and the Adjudicating Authority recorded different findings in these two matters of alleged breach of identical contraventions against the appellant i.e. of dropping the proceedings in one matter and holding him guilty in the impugned proceedings. Reliance has been wrongly placed upon the retracted statement without assigning reasons. The impugned order is totally without reasons and is non speaking and smacks of arbitrariness, therefore, it is unsustainable and consequently the appeal deserves to be allowed.

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• 2016 (9) TMI 166 - MADRAS HIGH COURT
  

  Defective notice - Whether the Tribunal was right in holding that the notice is defective and unsustainable? - Whether the Tribunal was right in holding that the independent properties of a relative of a convict or detenu,cannot be forfeited? - Held that:- As already held that the notice does not establish any link between the convict and the properties. It is also not the case of the petitioner that the properties were purchased out of illegal income earned in India by the convict. It is also pertinent to point out that the proceedings against the detenu was dropped on 10.02.1991. Had there been any nexus or link, the petitioner would not have dropped the proceedings. Though the burden of proof lies on the person affected under section 18, the statutory requirement for commencement of the proceedings cannot be forfeited to forfeit the properties. That stage would arise only when the notice is as per the statute. What by law requires to be express, cannot be left to be inferred. This court after careful consideration of the relevant provisions accepts the findings of the tribunal and holds that the notice under section 6 must establish the link or nexus and in the absence of the same, the entire proceedings would stand vitiated.

  The returns and the explanations must have been considered. The notice itself, proceeds on the basis that many properties are agricultural lands. There is also a reference to revenue records. The income tax authorities have also accepted the agricultural income. The conduct and the findings only reflect the non suiting of the legal norms by the authority. It is also not in dispute that the remittances from Malaysia was made through proper banking channel and the properties were purchased from agricultural income and remittances. Indisputably the properties are individual properties without any nexus to the convict/detenu. The object of the act is to ensure that the properties purchased out of smuggling activities or by illegal means in violation of the provision of the SAFEM Act cannot be permitted to be enjoyed by the convict/detenu or a relative holding the property as benami. The forfeiture of a relative’s property has to be read in the context and objects of the Act. It is only when the link or nexus of the properties with the convict/detenue or to the income from such illegal activity is established, the properties standing even in the name of a relative can be forfeited. Therefore, this court concurring with the view of the tribunal holds that the individual properties of a relative, as defined under section 2 of the SAFEM Act cannot be forfeited.

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