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TMI Blog2012 (7) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... Nos. 43 - 46 of 2010 confirming the dated 25.3.2009 passed by said Tribunal in Appeal Nos. 253 - 256 of 2002, the present appeal is filed. 5. Few facts necessary for the disposal of this appeal are as under: Each of the appellant received US$ 25000/- in their respective saving bank account on or about 12.10.1991 as and by way of remittance. The said accounts were maintained with Bank of Baroda, Vile Parle (East) Branch, Mumbai 400 057. According to the appellants the said remittances were received by them in accordance with the scheme namely Remittances in Foreign (Immunities ) Scheme, 1991 (" For short said Scheme"). This scheme was framed in accordance with the provisions of Remittances of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities and Exemptions) Act, 1999 (For short "the said Act). According to the appellants on account of the provisions of the said Act and the said Scheme, each of the appellant was fully protected in as much as it was not necessary for each of the appellant to disclose what is the nature of the remittance, what is the source of remittance, who had sent the foreign exchange, how this foreign exchange has been generated or earned, whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainst them. 8. The cause shown by each of the appellant was considered by the Special Director. The Special Director passed an order dated 24.4.2001. By the said order he came to the conclusion that the charge under Section 9(1)(f)(i) of the FERA Act to the tune of US$ 25000/- was made out against each of the appellant. He held each of the appellant guilty for the said contravention and imposed penalty of Rs.1,65,000/- on each of the appellant under Section 50 of the FERA Act. 9. Being aggrieved by the aforesaid order dated 24.4.2001, each of the appellant filed appeal before the said Tribunal. The said appeals were numbered as Appeal Nos. 253 to 256 of 2002. 10. The Chairperson of the said Tribunal heard learned Advocate on behalf of the appellants as well as the representative of the respondents and by judgment and order dated 25.3.2009 dismissed the said appeals thereby confirming the order impugned in the said appeals. A perusal of the aforesaid order dated 25.3.2009 indicates that the stand taken by the appellants that they were protected by the said scheme was rejected. 11. The appellants were aggrieved by the aforesaid order dated 25.3.2009. Each of them filed review app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have admitted that each of the appellant had paid a sum of Rs.6 lakhs and odd amount to Mr. Niranjan Shah, a person resident in India. According to learned Sr. Counsel Mr. Rana, payment of sum of Rs.6 lakhs and odd amount by each of the appellant to Mr. Niranjan Shah, a person who was resident of India cannot be considered as illegal. He further pointed out that the department before passing the order dated 24.4.2001 did not provide opportunity to each of the appellant to cross examine the persons who had rendered statements in the investigation which was conducted by the respondents. He had also submitted that statements of each of the appellants were not recorded. He had submitted that the Special Director as well as the chairperson of the said tribunal gave emphasis on the record which was collected in the course of investigation namely data found in the possession of Mr. Niranjan Shah wherein it was mentioned that the sum of Rs.6 lakhs and odd amount has been paid by each of the appellant to Mr. Niranjan Shah between September 1991 and May 1992 and there is corresponding credit entry in favour of Nilesh J. Vadhani. Learned Senior Counsel Mr. Rana had submitted that once it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant, Mr. Niranjan Shah and Mr. Vadhani the immunities mentioned in the said Act were not available to the appellants. Learned Advocate Mr. Shah tried to justify the order passed by the Special Director. 16. Learned Advocate Mr. Shah had further taken us through the order passed by the said tribunal being order in appeals as well as order in review proceedings being orders dated 25.3.2009 and 24.2.2011. Learned Advocate Mr. Shah had submitted that the Chairperson of the Tribunal had recorded a finding that the monies were paid out of India without general or special permission from Reserve Bank of India. He also submitted out that though there is protection to the person depositing the foreign exchange in the banks in India, the action of paying equivalent amount in Indian currency to a non resident is not protected and that is how the penalty can be imposed upon a person under Section 9(1)(f)(i) of the FERA Act who paid Indian currency to a person residing out of India. Learned Advocate Mr. Shah had therefore submitted that the authorities below were right in passing the impugned orders. He therefore submitted that the appeals should be dismissed. 17. We have considered the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esh Vadhani, a resident of Dubai and in lieu of the said adjustment between Mr. Niranjan Shah and Mr. Nilesh Vadhani each of the appellant received US$ 25000. 20. It is noticed that before passing the order against each of the appellant, the Special Director had not provided the relevant material to each of the appellant. Though each of the appellant had sought an opportunity to cross examine Mr. Niranjan Shah, the said opportunity was not granted by the Special Director and that the order imposing penalty passed by the Special Director was passed in violation of the principles of natural justice. Ofcourse, we are not inclined to dwell more about it as we are inclined to look to the entire matter from the point of submissions advanced by learned Sr. Counsel Mr. Rana as regards protection granted to each of the appellant by the said Scheme framed under the said Act. 21. After having read the provisions of the said Scheme, and the said Act, we hold that in terms of the said Scheme each of the appellant was fully protected and the Enforcement Directorate could not have initiated action against each of the appellant. The overt act of each of the appellant in receiving US$ 25000 in Oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nforcement Directorate itself that each of the appellant had paid Rs.6,44,000/- and odd amount to Mr. Niranjan Shah, a person resident in India. It appears that on account of the said finding at paragraph 7 the learned Chairperson had rejected the review applications. 25. For the reasons mentioned aforesaid, we hold that the payments made to Shri Niranjan Shah for being remitted outside India with a view to acquire US$ 25000/- by such appellant would not be in violation of Section 9(1)(f)(i) of the FERA Act in view of the fact that the amount of US$ 25,000/- has been declared as having been received under the said Scheme. Consequently no action could have been initiated against appellants under Section 9(1)(f)(i) of the FERA Act. Consequently, the order passed by the Special Directorate dated 24.4.2001, the order passed by the Chairperson of the said Tribunal in appeal Nos.253 -256 of 2002, and the order passed by the Chair person in Review Application Nos.43 -46 of 2010 cannot sustain and the said orders are required to be set aside. 26. Learned Advocate Mr. Shah appearing on behalf of the respondents had submitted that each of the appellant had not complied with the order of de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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