TMI Blog2011 (4) TMI 489X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed by way of remand to Tribunal - 3191-3194 of 2011 - - - Dated:- 11-4-2011 - R.V. Raveendran and K.S. Panicker Radhakrishnan, JJ. REPRESENTED BY : S/Shri Harish Salve, Sr. Counsel, Mohan Jayakar, Ms. Uma, Javaid Muzaffar and Umesh Kumar Khaitan, Advocates, for the Appellant. S/Shri Vivek Tankha, ASG, T.V. Ratnam, Rahul Kaushik, B.K. Prasad, Mrs. Anil Katiyar, Advocates, for the Respondent. [Judgment per : K.S. Panicker Radhakrishnan, J.]. - Leave granted. 2. The question that has come up for consideration in this case is whether the Appellate Tribunal constituted under the Foreign Exchange Management Act, 1999 (in short FEMA) was right in rejecting a belated appeal filed under Section 19 of FEMA, applying the first proviso to sub-section (2) of Section 52 of Foreign Exchange Regulation Act, 1973 (in short FERA), instead of following the proviso to sub-section (2) to Section 19 of FEMA. 3. M/s. Tirumalai Chemicals Limited (in short the Company ) had imported various consignments of benezene, orthoxalene etc. for home consumption. For the said purpose, the Company had opened Letters of Credit bearing No. MLCO 4359096 and No. 529/960487 on 28-9-96 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5-04 informed the Company that it had received ECC of bills of entry on 20-1-97 with difference of value. The ICICI Bank then forwarded a letter dated 15-5-04 to the RBI seeking its permission to accept the bills of entry stating that the Company had submitted the relevant documents on 20-1-97 with shortfall of value. The Standard Chartered Bank also vide their letter dated 12-5-04 informed the RBI that they had also received the Exchange Control Copy of bills of entry for the import in question from the appellant Company on 9-12-96, but due to an inadvertent mistake had reported in their BEF Return that bills of entry were not submitted. The RBI vide letter dated nil of May, 2004 sent by registered AD informed the Enforcement Directorate as follows :- Please refer to the outstanding entries reported in their respective BEF Statement by the captioned banks in respect of M/s Tirumalai Chemicals Ltd., which was forwarded to you by us. In this connection we advise that, based on the documents and evidence submitted by authorized dealer, we have deleted the entries from our records and regularized the transactions at our end as under :- (i) ICICI Bank confirmed that they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the order dated 25-10-2007 of the Tribunal as also the order dated 27-1-04 passed by the third respondent contending that the Tribunal was not justified in dismissing the appeals on the ground of delay. The High Court, however, dismissed all the writ petitions by the following order dated 24-7-2008 [2009 (234) E.L.T. 407 (Bom.)] :- There is no dispute that the appeal was filed beyond the period of 90 days. Therefore, the tribunal did not have jurisdiction to condone the delay. The learned counsel, then, submitted that we should consider these petitions as the petitions against the original order. In our opinion, it will not be appropriate to entertain these petitions as petitions against the original order. The Parliament has provided remedy of an appeal against the original order and has provided for period of limitation for filing that appeal. The Parliament has also provided that delay beyond a certain period cannot be condoned by the Tribunal/Appellate authority. The Petitioners have allowed that remedy of appeal to be barred, therefore, now to entertain these petitions as petitions against the original order would amount to permitting the Petitioners to frustrate th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court proceeded on the premises that since the cause of action arose when FERA was in force the period of limitation for filing an appeal before the Tribunal even after coming into force of FEMA is as provided under the first proviso to sub-section (2) of Section 52 of FERA. Admittedly, in this case the cause of action arose when FERA was in force, but show cause notices and impugned orders were issued when FEMA was in force and the appeals were also preferred under sub-section (1) of Section 19 of FEMA. Therefore, the important question that arises for consideration is whether limitation for filing the appeal has to be considered under the proviso to sub-section (2) of Section 19 of FEMA or under the first proviso to sub-section (2) of Section 52 of FERA. In order to answer the above question, it is necessary to examine the scope and ambit of Section 52 of FERA, Section 19, 49 of FEMA and Section 6 of the General Clauses Act, 1897. 12. FERA was enacted to consolidate and amend the law relating to certain payments dealing in foreign exchange and securities, transactions indirectly affecting the foreign exchange and import and export and import of currency, for conservation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditions as it may deem fit. .. 13. FERA was repealed by FEMA which came into force with effect from 1-6-2000. Chapter IV of FEMA deals with contravention of penalties. Section 13 of FEMA empowers the authorized officers to impose penalties for contravention of certain provisions of the Act. Failure to make full payment of penalty, may attract civil imprisonment subject to the provisions of sub-section (2) of Section 19. Chapter V of the Act deals with adjudication and appeal. Section 19 deals with the appeal to the Appellate Tribunal. Sub-section (2) of Section 19 says that every appeal under sub-section (1) shall be filed within a period of 45 days from the date on which the copy of the order made by the adjudicating authority or the Special Director (Appeals) is received by the aggrieved person. The Appellate Tribunal is also empowered to entertain the appeals filed after the expiry of the said period of 45 days if it is satisfied that there was sufficient cause for not filing the appeal within that period. Law is well settled that the manner in which the appeal has to be filed, its form and the period within which the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nature whereas law relating to right of appeal even though remedial is substantive in nature. 16. Therefore, unless the language used plainly manifests in express terms or by necessary implication a contrary intention a statute divesting vested rights is to be construed as prospective, a statute merely procedural is to be construed as retrospective and a statute which while procedural in its character, affects vested rights adversely is to be construed as prospective. 17. Right of appeal conferred under Section 19(1) of FEMA is therefore a substantive right. The procedure for filing an appeal under sub-section (2) of Section 19 as also the proviso to sub-section (2) of Section 19 conferring power on the Tribunal to condone delay in filing the appeal if sufficient cause is shown, are procedural rights. 18. We have already indicated that the proviso to sub-section (2) of Section 19 operates retrospectively, but the question is in that process, whether it impairs or takes away any accrued right, to plead a time bar and on facts whether the Company has lost its right of appeal to the Tribunal under FEMA. Law of Limitation 19. Law of limitation is generally regarded as p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... context of one set of facts but substantive in the context of different set of facts because rights can accrue to both the parties. In such a situation, test is to see whether the statute, if applied retrospectively to a particular type of case, would impair existing rights and obligations. An accrued right to plead a time-bar, which is acquired after the lapse of the statutory period, is nevertheless a right, even though it arises under an Act which is procedural and a right which is not to be taken away pleading retrospective operation unless a contrary intention is discernible from the statute. Therefore, unless the language clearly manifests in express terms or by necessary implication, a contrary intention a statute divesting vested rights is to be construed as prospective. A statute, merely procedural is to be construed as retrospective and a statute while procedural in nature affects vested rights adversely is to be construed as prospective. The manner of filing an appeal, under sub-section (2) of Section 19 of FEMA and the time within which such an appeal has to be preferred and the power conferred on the Tribunal to condone delay under the proviso to sub-section (2) of Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll offences committed under the repealed Act shall continue to be governed by the provisions of the repealed Act as if that Act had not been repealed. (5) Notwithstanding such repeal, - (a) anything done or any action taken or purported to have been done or taken including any rule, notification, inspection, order or notice made or issued or any appointment, confirmation or declaration made or any licence, permission, authorization or exemption granted or any document or instrument executed or any direction given under the Act hereby repealed shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provisions of this Act; (b) any appeal preferred to the Appellate Board under sub-section (2) of Section 52 of the repealed Act but not disposed of before the commencement of this Act shall stand transferred to and shall be disposed of by the Appellate Tribunal constituted under this act; (c) every appeal from any decision or order of the Appellate Board under sub-section (3) or sub-section (4) of Section 52 of the repealed Act shall, if not filed before the commencement of this act, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that no court shall take notice of any contravention under Section 51 of the repealed Act after the expiry of two years from the date of commencement of FEMA on 1-6-2000. Sub-section (4) of Section 49 stipulates that subject to the provisions of sub-section (3) all offences committed under the repealed Act shall continue to be governed by the provisions of the repealed Act as if that Act had not been repealed. 22. Sub-section (5) of Section 49 of FEMA consists of three clauses (a), (b) and (c). Clause (a) states that anything done or any action taken or purported to have been done or taken including any rule, notification, inspection, order or notice made or issued or any appointment, confirmation or declaration made or any license, permission, authorization or exemption granted or any document or instrument executed under the repealed act i.e. FERA to the extent they are not inconsistent with the provisions of this Act, are deemed to be done or taken under the corresponding provisions of this Act. The said provision has the effect of incorporating or making a general declaration that the existing rules, notifications, declarations, authorization and exemptions granted under FE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various decisions. Reference may be made to the decisions of this Court reported in Anant Gopal Sheorey v. State of Bombay, AIR 1958 SC 915, Rao Shiv Bahadur Singh . Anr. v. State of Vindhya Pradesh, AIR 1953 SC 394, State of Punjab v. Mohar Singh S/o Pratap Singh, AIR 1955 SC 84, T.S. Baliah v. T.S. Rangachari, ITO, AIR 1969 SC 701; Gajraj Singh Ors. v. State Transport Appellate Tribunal Ors. (1997) 1 SCC 650; Gammon India Ltd. v. Special Chief Secretary Ors. (2006) 3 SCC 354. 25. The appellate Board under FERA, it may be noted stood dissolved and ceased to function when FEMA was enacted. Therefore, any appeal against the order of the adjudicating officer made under FERA, after FEMA came into force, had to be filed before the Appellate Tribunal constituted under FEMA and not to the Appellate Board under FERA. Section 52 of FERA stipulates the limitation for an appeal against the orders of the adjudicating officer to the Appellate Board. It provides the period of limitation as 45 days but the Board may entertain an appeal after the expiry of 45 days but not beyond 90 days. Under FEMA, an appeal lies to the Appellate Tribunal constituted under that Act and Section 19(2) pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection (5) of Section 49 refers to appeal preferred and pending before the Appellate Board under FERA at the time of repeal. The said clause does not specifically refer to appeals preferred against adjudication orders passed under FEMA with reference to causes of action which arose under FERA. We have already noticed the right of appeal under FEMA has already been saved in respect of cause of action which arose under FERA however subject to the proviso to sub-section (2) of Section 19, in the case of belated appeals. 28. Above discussion will clearly demonstrate that Section 49 of FEMA does not seek to withdraw or take away the vested right of appeal in cases where proceedings were initiated prior to repeal of FERA on 1-6-2000 or after. On a combined reading of Section 49 of FEMA and Section 6 of General Clauses Act, it is clear that the procedure prescribed by FEMA only would be applicable in respect of an appeal filed under FEMA though cause of action arose under FERA. In fact, the time limit prescribed under FERA was taken away under the proviso to sub-section (2) of Section 19 and the Tribunal has been conferred with wide powers to condone delay if the appeal is not filed wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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