2005 (11) TMI 542 - AT - FEMA

Summary

Issues:
1. Challenge to adjudication order imposing penalty for contravention of Foreign Exchange Regulations Act.
2. Allegations of acquiring foreign currency without permission and failure to appear before Enforcement Officer.
3. Admissibility of confessional statements made under threat and coercion.
4. Burden of proof on appellant to demonstrate vitiating circumstances.
5. Legal principles regarding admissibility of statements obtained by improper means.
6. Non-appearance before Enforcement Officer and violation of section 40(b) of FER Act.
7. Forfeiture of foreign currency under section 63 of FER Act.

Analysis:
1. The appellant challenged adjudication orders imposing a penalty for contravening the Foreign Exchange Regulations Act by acquiring foreign currency without permission and failing to appear before the Enforcement Officer. The appellant pre-deposited the penalty amount on court directions. The appeal was taken up for final disposal, and written submissions were filed by the appellant's counsel.

2. Show-Cause Notices were issued to the appellant regarding the acquisition of foreign currency without permission and failure to appear before the Enforcement Officer. The appellant and another person admitted to transferring the foreign currency, which was later recovered by the Customs Department. The confessional statements were made under section 40 of FER Act. The appellant argued that the confession was retracted due to coercion and threat.

3. The appellant contended that confessions made under coercion are inadmissible, but failed to prove any vitiating circumstances. The burden of proof lies on the appellant to demonstrate coercion, which was not discharged. The Supreme Court precedent highlights the importance of voluntary statements and the need to consider retractions.

4. The arguments of coercion and inducement were deemed meritless, and the retracted confession did not negate the admission. Confessions can be accepted if found truthful and voluntary. The Adjudication Order was found legally sound in this regard.

5. Regarding the non-appearance of the appellant before the Enforcement Officer, the appellant's defense that he sought permission to bring his counsel was rejected. The appellant's failure to comply with the summons was admitted, leading to a penalty under section 40(b) of FER Act.

6. The appeal was deemed meritless and dismissed. However, the Tribunal noted that the foreign currency was not forfeited by the Adjudication Order. As per section 63 of FER Act, unclaimed foreign currency is forfeited to the Central Government. The appellant's pre-deposited penalty amount was to be appropriated by the respondent.