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Mohammed Yusuff Sahib Versus Special Director, Enforcement Directorate, New Delhi.

2016 (4) TMI 715 - MADRAS HIGH COURT

Proceedings under Section 51 of the Foreign Exchange Regulation Act, 1973 - Currency seized from the premises of assessee should be confiscated to the Central Government in terms of Section 63 of the Foreign Exchange Regulation Act, 1973 - maintainability of the appeal filed by the respondents before the Tribunal - Held that:- A careful comparison of the provisions of the Foreign Exchange Regulation Act, 1973 and the Foreign Exchange Management Act, 1999 would show that there was no post of Spec .....

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ken to be an aggrieved person and that the right of appeal under Section 19 of the Foreign Exchange Management Act, 1999 is conferred upon any aggrieved person. Since the Original Order of Adjudication was by the Collector of Customs, nominated under Section 16(1) of the Act, the appeal filed by the Special Director of Enforcement, before the Tribunal cannot be treated as not maintainable. The Department will come within the meaning of the expression "aggrieved person". Hence, the preliminary co .....

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Even assuming that he had a discretion, the manner in which the first authority exercised the discretion and the reasoning given by him are wholly unsustainable as can be seen from the extract of para 21 of the order of themOriginal Authority, which reads as follows:- - "However, the case is about 9 years old and since it is an endeavour to complete the adjudication proceedings, under the repealed Foreign Exchange Regulation Act, 1973, I take a lenient view and impose a penalty of ₹ 1, .....

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assed by the Appellate Tribunal for Foreign Exchange, in a Revision Petition filed by the appellant herein. 2. We have heard Mr.J.Ferozkhan, learned counsel for the appellant and Mr.M.Dhandapani, learned Standing Counsel for the Directorate of Enforcement. 3. On 4.10.1996, the business and residential premises of the appellant were searched under Section 37 of the Foreign Exchange Regulation Act, 1973. In the course of the search, Indian Currency of ₹ 60,000/- was recovered from his busine .....

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against him and as to why the Currency seized from his premises should not be confiscated to the Central Government in terms of Section 63 of the Foreign Exchange Regulation Act, 1973. 5. Eventually, an Order of Adjudication in Original was passed by the Commissioner of Customs (Exports) on 4.11.2004, holding the appellant, guilty of the charge under Section 9(1)(d) of the Foreign Exchange Regulation Act, 1973, in view of the fact that he had no permission from Reserve Bank of India to make paym .....

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y of ₹ 1,00,000/- upon the accomplice and directed the release of the seized amount of ₹ 10,00,000/-, after deducting the total fine amount of ₹ 1,25,000/- imposed upon both the persons. 6. Neither the accomplice S.M.Sultan, nor the appellant filed any appeal against the order of the Adjudicating Officer, holding them guilty of the respective charges. Therefore, the finding of the Adjudicating Officer that the appellant was guilty of violation of Section 9(1)(d) of the Foreign .....

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the Adjudicating Officer and increasing the penalty imposed upon the appellant from ₹ 25,000/- to ₹ 5,00,000/-. The Tribunal also directed the confiscation of the amount of ₹ 10 lakhs to the Government of India, under Section 63 of the Foreign Exchange Regulation Act, 1973. It is against the said order that the appellant is before us. 8. At the outset, Mr.J.Ferozkhan, learned counsel for the appellant raised a preliminary objection to the very maintainability of the Revision fi .....

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v. Rama Arangannal [1981 (1) MLJ 64] and the decision of the Supreme Court in Mohtesham Mohd. Ismail v. Special Director, Enforcement Directorate [(2008) 1 MLJ (Crl) 577 (SC)]. 10. In the case of Rama Arangannal, the learned Judge of this Court held that where an authority is vested with the powers of a quasi-judicial Tribunal, it would be a traverse of justice, to allow such an authority to file an appeal against the order passed by an appellate authority setting aside his own order. 11. What .....

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or of Enforcement filed a petition to permit him to amend the cause title so that the appeal could be treated as one filed by the Union of India represented by the Director of Enforcement. 12. Thiru. G.Ramanujam, J (as he then was), held on a reading of the Explanation to Section 54 of the Foreign Exchange Regulation Act, 1973 that under the said provision, it is only Central Government who can be treated as an aggrieved party for the purpose of filing an appeal. The appeal was filed by the Dire .....

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or of Enforcement filed an appeal to the High Court, without impleading the Central Government as a party. The High Court dismissed the appeal, placing reliance upon the decision of the learned Judge of this court in Rama Arangannal as well as on the decision of the Punjab and Haryana High Court in Director of Enforcement v. Lal Chand [(1985) 6 ECC 55]. While allowing the appeal of the individual, the Supreme Court reiterated the principles laid down in Rama Arangannal and held that when an adju .....

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efore getting into the decision relied upon by the learned counsel for the appellant, it is necessary to take note of one fundamental aspect. Under the Foreign Exchange Regulation Act, 1973, a set of officers were created under Section 3. They were (1) Directors (2) Additional Directors (3) Deputy Directors (4) Assistant Directors and (5) such other classes of officers. Under Section 5 of the Foreign Exchange Regulation Act, 1973, the Central Government was empowered to authorise any officer of .....

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ject to a further appeal to the High Court under Section 54 of the Act. Thus, a three tier maxim was created under the Foreign Exchange Regulation Act, 1973. The expression "Adjudicating Officer", was not defined in the Foreign Exchange Regulation Act, 1973. 17. In so far as the Foreign Exchange Management Act, 1999 is concerned, Section 2(a) defined the expression "Adjudicating Authority", to mean an officer authorised under Section 16(1) of the Act. Section 16(1) empowered .....

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or of Enforcement. 19. As against the orders passed by the Special Director (Appeals), an appeal under Section 17, a further appeal was provided under Section 19 to the Appellate Tribunal. Similarly, if the Original Order itself is passed by a person of the rank of Director, the appeal would lie to the Appellate Tribunal. As against the order of the Appellate Tribunal, a further appeal is provided to this Court under Section 75 of the Act. Thus, a four tier maxim was created under the Foreign Ex .....

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