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2016 (4) TMI 715 - MADRAS HIGH COURT

2016 (4) TMI 715 - MADRAS HIGH COURT - 2016 (336) E.L.T. 481 (Mad.) - 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 E .....

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to the appellant, in view of the fact that the Department could be taken 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 m .....

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t be approved. First of all we do not think that he had a discretion. 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the case is about 9 years old and since it is an endeavour to complete the adjudication proceedings, under the repealed Foreign Exchange Regulati .....

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was made by V.Ramasubramanian, J This appeal arises out of an order passed 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 sea .....

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of the Foreign Exchange Regulation Act, 1973 should not be initiated 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 .....

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0/- upon the appellant. The Adjudicating Officer also imposed a penalty 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 th .....

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d by the Tribunal by an order dated 26.9.2006, modifying the order of 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 .....

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e decision of a learned Judge of this Court in Director of Enforcement 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 p .....

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intainability of the appeal before this court. Immediately, the Director 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 .....

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d allowed the appeal of the individuals. Therefore, the Special Director 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 .....

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(Mad.)]. 15. We have carefully considered the above submissions. 16. Before 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, 1 .....

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to the Appellate Board. The Order of the Appellate Board, was made subject 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 offic .....

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such Adjudicating Authority was an Assistant Director or Deputy Director 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 7 .....

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