9911796707
TMI Blog2012 (10) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... January, 2008 till 1st December, 2008. Notice of this appeal was issued and the operation of the judgment of the Learned Single Judge stayed. The counsels have been heard. 2. The writ petition was filed by the respondent pleading that the appellant had on 3rd January, 2003 seized Rs. 7,75,000/- in Indian currency and foreign currency equivalent to Rs.96,000/- from the custody of the respondent and initiated inquiry under the provisions of Foreign Exchange Management Act 1999 (FEMA); that the adjudicating authority vide order dated 28th June, 2004 forfeited the seized currency and also imposed a penalty of Rs.5 lacs on LPA 669/2011 Page 1 of 6 the respondent; that the respondent filed an appeal before the Appellate Tribunal for Fore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rency together with interest at the rate of 6% per annum to such person." 4. The appellant contested the writ petition contending that under Rule 8 (supra) it was only the adjudicating authority which could have awarded interest @ 6% per annum and the adjudicating authority having not awarded such interest, no direction even under Rule 8 could be issued in writ jurisdiction. 5. The Learned Single Judge in the judgment impugned before us has held the respondent entitled to interest under Rule 8 and accordingly allowed the writ petition on aforesaid terms. Interest @6% on seized amount was allowed till 31.12.2007 to give time of about fifteen days after order dated 17.12.2007 for payment and @9% thereafter. 6. The appellant has challenged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e course of adjudication. While Rule 8(i) applies to return of seized currency after completion of investigation. Rule 8 (ii) applies to return of seized currency during adjudication. Again, while Rule 8(i) uses the words "shall be returned ........ with interest at the rate of 6% per annum.......", Rule 8 (ii) uses the words "may pass such order returning .......... together with interest at the rate of 6% per annum.......". The use of different words "shall" and "may" in Sub Rules (i) and (ii) respectively indicate that while it is mandatory to pay interest @6% per annum, when seized currency is returned on completion of investigation, it is not so when return is pursuant to adjudication and in which case it is in the discretion of adjudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olice. However, Section 38 of the Act provides for empowerment of other officers including Police to affect such seizure. The proceedings in the present case pursuant to initial seizure by Police were admittedly by FEMA. In this view of the matter, it is irrelevant whether initial seizure was by the police or by DOE and seizure is deemed to be under Section 37 of FEMA. However, FEMA does carve out a distinction between Indian currency and foreign currency. The Rules aforesaid enable the adjudicating authority to direct payment of interest @6% per annum while passing order for return of Indian currency only and do not empower the adjudicating authority to direct payment of any interest while directing return of foreign currency. Thus there c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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