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2009 (8) TMI 622

..... rdeep Singh @ Babu and another person Sh. Raman B. Gupta, Sh. Sunil Gill and Rajiv Kumar and Sh. Deepak were illegally acquiring and transferring foreign currency out of India to bring into India gold, silver and other dutiable goods. The petitioner seeks setting aside of order dated 31st January, 2008 passed by the Appellate Tribunal for Foreign Exchange directing the appellant to deposit 20% of the penalty amount within 30 days from the date of receipt of the said order. Held that- The petitioner has also produced medical record of his wife to show that he requires considerable amount of money for her treatment. In the circumstances if the petitioner is directed to deposit 25 lakhs of rupees, by any yardstick will cause ‘undue hardship’ to the petitioner. The Tribunal has elaborated what is ‘undue hardship’ but failed to apply the facts of the present case to infer whether ‘undue hardship’ shall be caused to the petitioner or not if the petitioner is directed to deposit the amount, in the present facts and circumstances and considering the prima facie case in favor of petitioner, it still cause irreparable loss to him. Therefore it has to be inferred that the impugned order direc .....

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..... f Rs.1,25,00,000/- pursuant to the adjudication proceedings under Section 8(1) and 8(2) of FERA, 1973. The plea taken by the petitioner in that writ petition was that he became aware of the penalty imposed upon him when the proceedings were initiated under Section 57 and 49(3) and (4) of Foreign Exchange Management Act. 7. The writ petition filed by the petitioner being W.P.(C) No. 12940/2006 was disposed of by this Court by order dated 22nd August, 2007 holding that there was no proof (acknowledgement Card etc.) evidencing service of order on the petitioner. The counsel for the respondent had also agreed to supply a copy of the order dated 26th March, 1997 and pursuant thereto the petitioner was directed to prefer an appeal before the Appellate Tribunal, Foreign Exchange in terms of Section 19 of FEMA within two weeks of the receipt of the order which was to be dispatched by the respondents. 8. The petitioner thereafter filed the appeal under Section 52 of Foreign Exchange Regulation Act, 1973 read with Section 19 of Foreign Exchange Management Act, 1999 against the order No. T-4/55-B/94 dated 26th March, 1997 bearing the file No. 41-43/B/SDE/PXA/97 passed by the Special Director .....

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..... t of a co-accused could not be the basis for imposing penalty on the petitioner especially when there are no such documents detailed in the adjudication order, which would corroborate the statement and implicate the petitioner. It is contended that on the basis of the statement of Raman B. Gupta, co accused, the penalty could not be imposed on the petitioner. Regarding the alleged confessional statement of Sh. Atul P.Shah it is contended that he has not implicated petitioner in his confessional statement. 11. The learned counsel for the petitioner has categorically contended that it was never asserted before the Appellate Tribunal that, petitioner had made the confessional statement which was retracted by him. In the circumstances, it is contended that the Appellate Tribunal has passed the order mechanically without considering whether there is a prima facie case against the petitioner or not. Relying on the copy of the appeal filed before the Appellate Tribunal it is contended that the plea has been recorded by the Appellate Tribunal is contrary to the grounds raised by the petitioner in the grounds of appeal. 12. The petitioner has also challenged the order on the ground that tho .....

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..... ere is sufficient corroborative material available to implicate the petitioner. 15. It is further asserted by the respondent that the accused was sent show cause notice by post which he failed to accept and it was served by Rule 10(c) of the Adjudication Process and Appeal Rules, 1974. 16.I have heard the learned counsel for the parties and have perused the petition, counter affidavit and the documents filed by the parties. This Court by order dated 22nd August, 2007 in W.P.(C) No. 12940/2006 Virender Kumar Yadav v. Union of India has already held that the order of adjudication was not received by the petitioner and consequently the respondents were directed to give the copy of the order. Regarding the service of show cause notice also although it is contended that there is some evidence, however, despite a specific plea taken by the petitioner in his appeal before the Appellate Tribunal that show cause-notice was not served on him nothing has been produced by the respondent, to show that the show cause notice was duly served on the petitioner. 17. From the grounds of appeal raised before the Appellate Tribunal, it is also apparent that the ground taken by the petitioner is that he .....

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..... nd consideration of entire material, is likely to cause prejudice to either side. But at the same time, the authority concerned is required to consider whether with reference to the material placed before it, a prima facie case for grant of stay is made out or not and the balance of convenience lies in whose favor. 20. What is a prima facie case? It is well settled that it refers to an arguable or triable case. The Tribunal once if comes to the conclusion on perusal of the pleadings, documents and on hearing of the parties that there is a good prima facie case to be considered, the next step in exercise of discretion is determining the quantum of waiver to be granted. In determination of the quantum of waiver, factors, such as, balance of convenience, financial hardship of the parties, its capacity to pay or secure the amount and irreparable loss are to be considered. The said discretion is to be exercised in accordance with well settled principles for exercise of judicial discretion. 21. Some judicial decisions where provisions namely Section 129E of the Customs Act, 1962, Section 35F of Central Excise Act, 1944 have been considered by the Courts lays down. (i) In VIP Sea Foods v. .....

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..... of the petitioner. The petitioner has not retracted his statement. The confessional statement by the co-accused implicating petitioner was retracted by him. But there are no documents shown by the respondent which will corroborate the statement of co-accused so far as it pertains to implication of petitioner. The other co-accused also retracted his confessional statement, but in his confessional statement he had not implicated the petitioner. 23. The petitioner has produced his income tax returns to show that his earnings are not more than Rs.10,000/- per month. The petitioner in the circumstances has discharged his initial burden. The plea of the learned counsel for the respondent that it cannot be believed that the petitioner who is running a restaurant at a prominent place will earn only Rs. 10,000 per month. The respondent could have got ascertained as to how many employees are working for the petitioner and how big his restaurant is or some other facts to rebut the allegation of the petitioner, which has not been done. In the circumstances, on mere denial by the respondent, the income tax returns filed by the petitioner cannot, be ignored. The petitioner has also produced medi .....

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