2008 (4) TMI 781 - AT - FEMA

Summary

Issues:
Violation of Section 9(1)(d) of FERA, 1973

Analysis:
The appellant appealed against an Adjudication Order imposing a penalty for contravention of Section 9(1)(d) of FERA, 1973. The appellant argued that the transaction was covered under the Remittance of Foreign Exchange and Investment in Foreign Exchange Bond (Immunities and Exemptions) Act, 1991, granting immunity. The appellant retracted a confessional statement, alleging coercion, and argued lack of independent evidence to support it. The Enforcement Officers found that the appellant received a cheque from a non-resident Indian and paid an amount exceeding the principal, corroborated by circumstantial evidence.

The appellant contended that the retracted statement should not be admissible without proof of coercion. The Tribunal cited legal precedents stating that retracted confessions can be grounds for conviction with sufficient corroboration. The appellant's admission of receiving the cheque for a premium and lack of evidence of acquaintance with the non-resident Indian supported the charges. The Tribunal discussed the legal principles regarding gifts, emphasizing the need for voluntary gifting without consideration.

The Tribunal referred to Supreme Court cases highlighting the importance of circumstantial evidence in proving guilt beyond reasonable doubt. The appellant's failure to explain the transaction details led to adverse presumptions under the Evidence Act. The burden of proof was on the appellant regarding the transaction's nature, as per legal precedents. Section 9(1)(d) of FERA prohibits payments to non-residents without RBI permission, which was found to be violated. The Tribunal reduced the penalty amount due to a single transaction but upheld the appellant's guilt and the penalty imposition.

In conclusion, the Tribunal upheld the penalty imposition for violating Section 9(1)(d) of FERA, citing corroborated evidence and legal principles regarding confessions, gifts, and circumstantial evidence. The appellant's failure to prove innocence or explain the transaction details led to adverse presumptions, resulting in guilt confirmation. The penalty amount was reduced due to a single transaction, but the appellant's liability was established under the relevant legal provisions.