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2015 (3) TMI 1165 - APPELLATE TRIBUNAL FOR FOREIGN EXCHANGE NEW DELHI

2015 (3) TMI 1165 - APPELLATE TRIBUNAL FOR FOREIGN EXCHANGE, NEW DELHI - 2015 (330) E.L.T. 474 (ATFE) - Application for amendment in the memo of appeal - Held that:- The amendment application appears to have been made bonafidely and through it the appellant wants to bring on record the subsequent developments. Through the proposed amendment, no new cause has been set up by the appellant and is in continuation of the facts which were placed earlier. The subsequent developments are being placed be .....

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on and Dr. H.K. Mudgil, Member Ms. Natasha Garg, Advocate, for the Appellant. Shri M.R. Venkatesh, Chartered Accountant assisted by Ms. Natasha Sarkar, Legal Consultant, for the Respondent. ORDER [Order per : V.K. Mathur, Chairperson]. - The appellant has moved an application for amendment in the Memo of appeal contending that the appeal filed by the appellant against the Adjudication order, dated 31-3-2010 is pending adjudication and has not been heard so far. Against the common impugned/adjudi .....

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applicant/appellant had contravened the provisions of Sections 7 & 8 of FEMA, 1999 read with Foreign Exchange Management (Export of Goods and Services) Regulations, 2000. It has been contended that significant developments have taken place after the filing of the appeal which are relevant and necessary to be placed on records. Therefore, the proposed amendment is essential. 2. Through the proposed amendment the details of incorporation of the company and details of agreement are propose .....

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The details of which have been given in the proposed amendment application. It has also been contended that since the STPI could not provide information and certification for some other bills and forms, the RBI did not provide ex post facto approval for the same. The details of financial status of the company and the difficulty and hardship in making the payment have also been explained in proposed paragraph 3.19 of the amendment application. Auditors report is also proposed to be placed as Ann .....

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der that the Misc. petition under order VI Rule 17 of the Civil Procedure Code is not tenable as the application has been filed by the appellant in 2013, claiming to have realized the un-realized export proceeds. However, the appellant had not realized the export proceedings in time nor had taken reasonable steps for realization, therefore appellant has clearly contravened the provision of Sections 7 & 8 of FEMA, 1999. It has also been stated that invoking the remedy of amendment under order .....

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ribe any amendment of the pleadings. The Tribunal is to determine whether the amendment is necessary for the purpose of determining the real question in controversy between the parties. The rules are framed by the Central Government under Section 46 of the Act and smuggling through the provision of order VI Rules 17 CPC would be ultra vires. 4. It has also been contended that the motive behind moving the application is to ask the Tribunal to examine and weigh evidence submitted, regarding a .....

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on clearly state that omission of the RBI to give direction shall not have the effect of absolving the person committing the contravention from the consequences thereof. Therefore, the impugned order is correct. It has also been contended that the appellant has failed to take necessary approval during the course of investigation and prior to passing of the impugned order. Subsequent regularization letters only regularize the export proceeds brought into the country belatedly but in no way this a .....

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011 and 2013. Therefore, its claim of facing financial hardship is contrary to facts and no undue hardship will be caused to the appellant. 5. Rejoinder to the objection has been filed by the appellant reiterating the contentions of the amendment application. Affidavit of Shri A.S. Seshagiri Rao, Managing Director has also been filed in support of the rejoinder. It has been pleaded in the rejoinder that the objections have been filed without any authorization from the respondent. The conten .....

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as been contended that the fact of realization and repatriation of the amounts as well as financial condition of the applicant has to be brought on record. The contentions of paragraph 8 of the objection have been denied and it has been pleaded that the provision of Section 28 of FEMA 1999 do not restrict this Tribunal or Special Director (Appeals) from following procedure under CPC. The provisions of CPC are in consonance with the principles of natural justice. The contentions of paragraph 9 of .....

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the objection have also been denied reiterating the contentions of the applicant. It is stated that the matter for writing off was pending before the RBI and the impugned order could not have been passed by the Special Director. The contentions of paragraph 12 have also been denied. In reply to paragraph 13 of the objection it has been stated that the reliance placed on the applicability of the Section 19 FEMA which is misplaced as no statutory period is prescribed either under the FEMA or rules .....

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d have also carefully perused the record. 7. It has been contended by ld. counsel for the appellant that to bring subsequent developments which have taken place after the institution of the appeal, the application for amendment has been moved so that the Tribunal after taking into account the subsequent developments which are very material and relevant, may decide the appeal on merits. The Adjudicating officer did not afford sufficient time or opportunity to the appellant to place the detai .....

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ppellant may be in a position to convince the Tribunal that all possible efforts were exhausted by the appellant and there was nothing more left which could be attempted by the appellant. 8. Further submission is that under order 6 Rule 17 CPC the amendment may be moved and allowed at any stage of the proceedings including at the appellate stage and appeal is treated to be continuation of the original proceedings. To impart justice to the parties it is necessary that the Tribunal must have .....

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me Court dealing with order 6 Rule 17 has said that the object of the rule is that the Court should try the merits of the case that comes before them and consequently may allow all the amendments that may be necessary for determining the real question in controversy. It has also been held in the judgment that the role of amendment is essential and role of justice, equity and good conscience and the power of amendment should be exercised in the larger interest of doing full and complete justice t .....

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red remedy. 11. Reliance has also been placed on Abnash Kaur v. Avinash Nayyar in CM(M) 269 of 1973, decided on 5-4-1974 by Hon ble Delhi High Court wherein principles of allowing the amendment application have been laid down. Lastly, it has been submitted that the application has been made in good faith and the appellant has come with clean hands and his bona fides cannot be doubted. Therefore, the application deserves to be allowed. 12. Ld. Presenting Officer/CA has vehemently oppose .....

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6,01,36,181 and the appellant approached RBI for its write off which was not permitted. The applicant/appellant has failed to show that the proposed amendment is necessary for the purpose of determination of the real question in controversy between the parties as is contemplated under order 6 Rule 17 of CPC. The realization of some of the export proceeds do not alter or change the real question involved in the appeal. The fact remains that the appellant has failed to realize the same in time and .....

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lving the person. The person committing the contravention cannot escape from its consequences. There is a delay in moving the amendment application. The regularization letter by RBI was issued on 2-1-2013 and the application was filed in June, 2013 which is beyond the statutory limit of 45 days as mandated under sub-section (2) of Section 19. 13. Reliance has been placed on the judgment of Subrata Roy Sahara v. Union of India in WP (Criminal) No. 57/2014, decided on 6-5-2014. It has been su .....

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o been submitted that the provisions under Section 15U of SEBI Act are pari materia to that of Section 28(1) of FEMA, 1999. 14. We have considered the submissions of ld. counsel for the appellant as well as ld. Presenting Officer/CA. 15. It is true that Section 28 FEMA, 1999 which prescribes the procedure and powers of the Appellate Tribunal and Special Director (Appeals) does not specifically mention under sub-section (2) power to allow amendment . Further it has been provided under s .....

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ect of the amendment is that the Courts should try cases on merits that come before them and should consequently allow all the amendments that may be necessary for determining the controversy between the parties, provided it does not cause injustice or prejudice to the other side. In para 18 of the said judgment relied upon by the ld. counsel for the appellant it has been observed by Hon ble Supreme Court that It is settled by catena of decisions of this Court that the rule of amendment is essen .....

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i Venkateshwarlu v. The Motor & General Traders also relied upon by the ld. counsel for the appellant in para 4 it has been observed that the procedure is a hand made and not a mistress of the judicial process. If a fact, arising after the lis has come to court and has a fundamental impact on the right to relief or the manner of mounding it is brought diligently to the notice of the Tribunal, it cannot blink at it or be blind to events which stultify or render inept the decretal remedy. Equi .....

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dment under Civil Procedure Code to allow amendment by this Tribunal to bring on record the subsequent development in the matter will not be in conflict with the principles of natural justice. Further, though the provisions of order 6 Rule 17 CPC have not been made applicable directly under FEMA 1999, however, very the object of permitting amendment in pleadings and the requirement of bringing material/substantial subsequent developments in proceedings which are of quasi civil nature have not be .....

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he passing of the Adjudication Order will be seen at the time of final disposal of the appeal. This in our view is not an appropriate stage to consider the merits of the arguments that since, prima facie a technical violation is made out the amendment application should be rejected. In Pasupuleti Venkateswarlu's case the Hon ble Supreme Court has gone to the extent of observing that equity justifies bending of the rules of procedure where no specific provision or fairplay is violated. 21.&em .....

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