TMI Blog2015 (10) TMI 264X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant in the first miscellaneous appeal, may have been driven by circumstances that provide for avoidance of double taxation. Hence, the first question of law is to be answered against the appellants. The Appellate Tribunal itself has gone into the question relating to the expression 'acquire' in Section 8(1) and came to the conclusion that the non examination of Mrs.Seethalakshmi Nagaraj on the side of the defence was fatal. It was not relied upon by the prosecution. There was no explanation as to why and how the appellant in the second miscellaneous appeal came to the premises that was being raided, with a briefcase carrying foreign currencies. In such circumstances, we do not think that the orders of the Adjudicating Authority and the Appellate Tribunal call for any interference. - Decided against the appellants. - Civil Misc. Appeal Nos. 2581 and 2582 of 2011 - - - Dated:- 19-8-2015 - V. Ramasubramanian And T. Mathivanan, JJ. For the Petitioner : Mr B Kumar, SC for Mr B Satish Sundar For the Respondent : Mr M Dhandapani, Standing Counsel JUDGMENT Judgment was delivered by V. Ramasubramanian, J These two appeals are filed under Section 35 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellants. By the said order, the appellants were imposed with penalties of ₹ 2 lakhs each for contravention of Section 8(1) of the FERA, 1973. The foreign currencies recovered from both the appellants were also directed to be confiscated to the credit of the Central Government account in terms of Section 63. 7. As against the orders of adjudication, the appellants filed two independent appeals in Appeal Nos.175 and 178 of 2008 before the Appellate Tribunal. The Appellate Tribunal confirmed the findings of the Adjudicating Authority with regard to the contravention of the provisions of the Act, but reduced the quantum of penalty to the extent of the pre-deposit made by the appellants at the time of filing of the appeals. Not satisfied with being let off so, the appellants have come up with the above appeals. 8. Since the present appeals are filed under Section 35 of the new Act, the appeals are filed on certain questions of law. The questions of law that the appellants have raised in the memorandum of grounds of appeals are as follows : (i) Whether the second respondent Tribunal viz. Appellate Tribunal for Foreign Exchange, New Delhi is right in holding that a charge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd respondent Tribunal findings vitiated on account of perversity and errors apparent on its face, ignoring vital and relevant material and taking into consideration extraneous and irrelevant material in arriving at a conclusion that the appellant had 'otherwise acquired' the foreign currencies and thereby sustaining the charge under Section 8(1) of the Foreign Exchange Regulation Act, 1973 ? and (ix) Is the second respondent Tribunal right in ignoring settled precedents on the issue as to what would amount to 'otherwise acquired' of foreign currencies in terms of Section 8(1) of the Foreign Exchange Regulation Act, 1973 ? 9. Though the appellants have raised 9 questions of law, we are of the considered view that only two questions of law actually arise for consideration. They are : (i) Whether the Adjudicating Authority and the Appellate Tribunal could have ignored the orders of assessment passed under the Income Tax Act, both in respect of the appellant in the first miscellaneous appeal and in respect of Mrs.Seethalakshmi Nagaraj, who, right from the beginning, claimed to be the owner of the foreign currencies seized from the premises that was raide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the currencies from the income of the appellant in the first miscellaneous appeal, was confirmed by the Division Bench of this Court in T.C.(A).No.150 of 2004 by a judgment dated 3.9.2007. The effect of the said judgment was that the value of these foreign currencies could not be taken to be the income of the appellant in the first miscellaneous appeal for the relevant assessment year, as it was claimed to belong to one Mrs.Seethalakshmi Nagaraj. 13. Therefore, (i) on the basis of the statements recorded under Section 40 from the appellants as well as Mrs.Seethalakshmi Nagaraj and (ii) on the basis of the deletion of the value of those currencies from the income of the appellant in the first miscellaneous appeal, in the proceedings under the Income Tax Act, it is contended by Mr.B.Kumar, learned Senior Counsel appearing for the appellants that the orders of adjudication and the order of the Appellate Tribunal holding the appellants guilty of contravention of Section 8(1) were completely contrary to law. Under Section 8(1) of the FERA, 1973, a person can be held to be guilty of an offence, only if he purchases or otherwise acquires or borrows from or sells or otherwise transfers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow from (iv) sell (v) otherwise transfer (vi) lend to and (vii) exchange with. The liability to pay income tax need not arise, when any of these seven expressions are satisfied with regard to an income. There are a variety of reasons for enabling a person to make a claim for some money or disclaim an amount. It is only in three or four contingencies that are indicated in Section 8(1) that a person may become obliged to pay tax. Therefore, the decision rendered in T.C.(A).No. 150 of 2004 need not necessarily be a pointer to the effect that there was no violation of Section 8(1) of the FERA. 19. Mr.M.Dhandapani, learned Standing Counsel for the first respondent is right in relying upon the decision of the Supreme Court in this regard in K.T.M.S.Mohamed Vs. Union of India [AIR 1992 SC 1831]. In the said decision, the Supreme Court pointed out that the purport of the Income Tax Act and the FERA, 1973 are different. In paragraph 24 of the said decision, the Supreme Court made it clear that the FERA and the Income Tax Act are two separate and independent Acts operating in two different fields. Therefore, we do not think that the appellants can take advantage of the decision rendered i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t treats the civil liability and the criminal liability differently. Though an order of adjudication may ultimately result in the order of confiscation and the imposition of penalty, it is not strictly criminal in the sense in which we understand criminality. At the most, it could be taken to be quasi criminal. 24. However, relying upon the decision of the Supreme Court in Gopaldas Udhavdas Ahuja Vs. Union of India [(2004) 176 E.L.T. 3], it is contended by Mr.B.Kumar, learned Senior Counsel for the appellants that the moment it is found that when the criminal prosecution as well as the adjudication proceedings are based upon the same set of facts and the proceedings rely upon the same evidence, two different authorities cannot come to two different conclusions. 25. The case in Gopaldas Udhavdas Ahuja arose out of the proceedings for adjudication under Section 71(1) of the Gold (Control) Act, 1968. Drawing inspiration from the decision in Captain M. Paul Antony Vs. Bharat Gold Mines Limited [1999 (3) SCC 679], the Supreme Court held that on the basis of the same set of facts, on the basis of the same incriminating materials and on the basis of the statements of the same witnes ..... X X X X Extracts X X X X X X X X Extracts X X X X
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