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TMI Blog2015 (12) TMI 1695X X X X Extracts X X X X X X X X Extracts X X X X ..... uilty of contraventions of Section 8(3) and 8(4) of FERA, 1973 r/W Section 49(3) and 49(4) of FEMA, 1999 who has imposed a penalty of Rs. 1,40,71,263/- on appellant M/s. Thirumalai Chemicals Ltd. 3. Appeal No. 789/2004 has been filed challenging separate Adjudication Order No. ADJ-75/B/AAO/PKS/2004/1437, dated 27-1-2004, passed by Sh. P.K. Sinha, Addl. Commissioner of Customs and the Adjudicating Officer holding the appellant guilty for contraventions of Section 8(3) and 8(4) of FERA, 1973 r/w Section 49(3) and 49(4) of FEMA, 1999 who has imposed a penalty of Rs. 1,41,90,175/- on appellant M/s. Thirumalai Chemicals Ltd. 4. Appeal No. 790/2004 has been filed challenging Adjudication Order No. ADJ-76/B/AAO/PKS/2004/1438, dated 27-1-2004, passed by Sh. P.K. Sinha, Addl. Commissioner of Customs and the Adjudicating Officer holding the appellant guilty of contraventions of Section 8(3) and 8(4) of FERA, 1973 r/w Section 49(3) and 49(4) of FEMA, 1999 and consequently imposed a penalty of Rs. 5,69,11,840/- on appellant M/s. Thirumalai Chemicals Ltd. 5. Since all the appeals have been filed by the same company against different adjudicating orders of the even dates involv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocumentary evidence in defence to prove that goods had duly arrived and despite opportunities for personal hearing and reminders failed to produce any evidence in rebuttal/reply of the requirements of the provisions alleged to have been contravened, therefore, on account of failure to produce any evidence the appellant was held guilty for contraventions of Section 8(3) and 8(4) of FERA, 1973 r/w sub-section (3) and (4) of Section 49 of FEMA, 1999 and the Adjudicating Authority imposed a penalty of Rs. 1,40,71,263/- on the appellant company. 8. In Appeal No. 789/2004 it is alleged that the company had acquired foreign exchange equivalent to Rs. 1,41,90,175/- but had failed to submit any evidence of import as required in Section 8(3) and 8(4) of FERA, 1973 r/w 7A. 20 (Chapter-7) of ECM r/w Section 49 of FEMA, 1999 and a penalty of Rs. l,41,90,175/- has been imposed on the appellant company. 9. Similarly, in Appeal No. 790/2004, it has been alleged that the company had acquired foreign exchange equivalent to Rs. 5,69,11,840/- and had failed to submit any evidence of import as required and the Adjudicating Authority has held the company guilty of contravention of Section 8( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the impugned order. However, bank authorities neglected the summons and did not inform the appellants nor filed any reply before the Adjudicating Authority. It has also been contended that the Adjudicating Authority has failed to give any particulars and reasons in the Impugned Order as to how it was concluded that the appellants had failed to submit the evidence of import in respect of the foreign exchange released to the company by the authorized agents. The Adjudicating Authority committed error in not affording reasonable opportunities to the appellants to represent and defend themselves, the orders were passed without due application of mind and the efforts made by the appellants were not taken into due consideration, which was incumbent upon the Adjudicating Authority. The authorized dealers it appears had wrongly informed the RBI about non submission of bills of entry, though the same had been received, which, might have resulted into inclusion of the name of the appellants in the list of defaulters. The Adjudicating Authority committed error in arriving at its conclusion without any documentary evidence or cogent evidence available in support at all. Therefore, it has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e been given. The Impugned Orders in view of the fact that proof of timely submission of all the bills of entries in respect of all the transactions had been duly filed in respect of all the appeals and copies of all communications by the appellants to the authorized dealers (banks), by RBI to the authorized dealers and also to the officers of Enforcement Directorate to review the order have been filed, therefore, the appeals are not sustainable and are liable to be quashed. Since the Impugned Orders are devoid of any merits and have been passed illegally and are not sustainable, therefore, all the appeals deserve to be allowed. Reliance has been placed on the judgments of Hindustan Steel Ltd. v. State of Orissa - MANU/SC/0418/1969 = 1978 (2) E.L.T. (J159) (S.C.), Xerox Modi Corpn. Ltd. v. The Special Director - MANU/DE/0110/2015 and Director of Enforcement v. M.C.T.M. Corporation Pvt. Ltd. - (1996) 2 SCC 471. 12. Ms. Natasha Sarkar, legal consultant has defended the impugned order and has contended that show cause notices were dispatched to the appellants but they failed to appear or file any response to them. She has argued that the rules do not talk about the requirement o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anded as last resort to the Adjudicating Authority for consideration of the evidence filed by the appellants. 13. We have considered the submissions of Ld. counsel for the appellants as well as Ld. legal consultant and are of the view that though the Civil Procedure Code, 1908 is directly not applicable in the proceedings before the Tribunal and the Tribunal can lay down its own procedure but simultaneously it is to be ensured that the principles of natural justice are not violated in any way. In the instant appeals it has been alleged that SCNs were issued to the appellants, however, no proof of the service upon the appellants has been filed. There is no proof of service of notices for personal hearing and their alleged reminders to the appellants as well. We are not in agreement with the submissions of Ld. legal consultant that service upon the notice is not contemplated anywhere in the rules or regulations, in our view unless the communication is served upon the addressee he cannot be expected to appear and defend or contest his case. Thus in our opinion the principles of natural justice have not been adhered by the Adjudicating Authority in proceeding ex parte particularl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant has filed copies of receipts of two bills of entry by the ICICI bank on 20-1-1997 and copy of bills of entries have been filed as Annexure 'A'. Yet another copy of receipt of two more bills of entry which were submitted on 18-1-1997 to the ICICI bank by the company have been filed and also confirmation of receipt of the copies of bills of entries in respect of the transactions by the ICICI bank to the RBI has been filed as Annexure 'C' 18. In Appeal No. 789/2004 also the appellant has filed two communications both dated 18-1-1997 as Annexure 'B' duly acknowledged by ICICI bank of the receipt of the 4 bills of entry in connection with the import of benzyne. Copies of bills have also been filed and also communication by ICICI bank to RBI dated 15-5-2004 and also the communication by RBI of May, 2004 as Annexure 'E' confirming the receipt of the bills of entry by the bank. 19. Similarly, in Appeal No. 790/2004 also proof of filing the bills of entry towards the import of orthoxylene in respect of 6 bills of entry were filed with the Standard Chartered Bank and were duly received, by the Bank on 9-12-1996 and copies of bill of entries ex-bond clearance home consump ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on'ble High Court which set aside the order of this Tribunal and directed the Tribunal to hear the appeals on merits without insisting of pre-deposit. 23. We see no reason to remand the matter back to Adjudicating Authority at this stage when parties have been litigating for a period of more than 11 years. The genuineness of the papers filed by the appellants as proof of due compliance of the requirement of filing of the exchange control copies of the bills of entry with the authorized dealer within time has not been disputed by the respondents. The appeals are continuation of the trial proceedings. We are convinced on the basis of evidence filed by the appellants in the instant appeals that they had timely submitted the exchange control copies of Bills of Entries to the respective authorized dealers (banks). We are also convinced with argument that it was negligence/mistake on the part of the authorized dealers in not reporting the due compliances to the RBI and instead furnished wrong information. The basic fault appears to us on the part of the banks but since they are neither parties in these appeals nor they have been afforded any opportunity to place their version befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt we would like to record our appreciation for the sincere efforts made by Mr. Rahul Ray, counsel for the appellants and Ms. Natasha Sarkar, legal consultant. ORDER All the appeals are allowed with costs of Rs. 5,000/- each and the Adjudication Orders impugned herein :- 1. Adjudication Order No. ADJ-73/B/AAO/PKS/2004/1435, dated 27-1-2004 2. Adjudication Order No. ADJ-74/B/AAO/PKS/2004/1436, dated 27-1-2004 3. Adjudication Order No. ADJ-75/B/AAO/PKS/2004/1437, dated 27-1-2004 4. Adjudication Order No. ADJ-76/B/AAO/PKS/2004/1438, dated 27-1-2004 are set aside. The respondents are directed to pay a token cost of Rs. 5,000/- per appeal totalling Rs. 20,000/- to the appellants within a period of two months from the date of communication of this judgment. Copies of this judgment be placed on the record of Appeal Nos. 788 to 790/2004. 26. The Registrar is directed to send copies of this judgment to the appellants and respondents. (Judgment signed dated and pronounced in the open Tribunal to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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