9911796707
TMI Blog2016 (9) TMI 1344X X X X Extracts X X X X X X X X Extracts X X X X ..... of India - Kandla, Kutch Branch revealed that an amount of Rs. 16,1,065/- under two GR Nos. 013890, dated 27-8-1983 and Gr. No. 414797, dated 2nd March, 1984 were pending reliasation. During investigation Sh. R.K. Dikshit, Authorised Signatory of the company stated that M/s. Mohan Carpets had exported two consignments one to M/s. Harrison and Berdsley U.K. on 14-9-1993 for 32,000 pounds and other to M/s. Indecoration, Paris, France on 16-2-1984 for F.F. 1,57,625/- and an amount of 2000 pounds had been remitted in respect of the former transaction. It is also stated that the company has many directors on its Board, but Sh. Rohit Sahu was the director in charge responsible for the total operations of the company including production and marketing and he committed a fraud by collecting the export proceeds outside India and retaining the same in U.K. in some other company's accounts in collusion with that company, namely M/s. Gleebjay Ltd. U.K. in which he himself was a partner. It is also stated that a suit was filed in High Court of Justice, Queens Bench Division, London in 1985 in this respect and Amnesty was granted by RBI under Amnesty Scheme. The fees of the Solicitors in U.K. c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for 1,00,000 Sterling Pounds from overseas agents. 3. On conclusion of the investigation Memorandum dated 19th March, 2002 was issued to M/s. Mohan Carpets and its directors for having contravened the provisions of Sections 18(2) and 18(3) read with Section 68 of FERA, 1973 and also read with Central Government Notification No. F-1667/EC/73/1&3 both dated 1-1-1971. Two other show cause notices were issued to M/s. Mohan Carpets and its Directors for having contravened Sections 9(1)(C), 8(1) and Section 25 FERA, 1973 for acquiring, transferring the Foreign Exchange and acquiring immovable property in London. One show cause notice dated 20-11-2001 was decided by the Adjudicating Authority wherein penalties were imposed against the noticees. 4. In response to the show cause notice dated 19-3-2002 replies were filed on behalf of Rakesh Mohan and Mrs. Comilla Mohan challenging the competence of the authority to issue show cause notice and contending that at the relevant time the noticees were not in-charge and responsible for the business. Sh. R.D. Mohan vide his reply stated that he was under employment from 1973-84 as Manager and Executive Director of Mohan Rockey Springwat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Sh. Rakesh Mohan in his statement recorded on 20-2-2001 had admitted that the exported goods of the notice company were actually bought by some other importer namely M/s. MEVCARDO U.K. other than the importer on paper at a much higher price than the export price shown by the noticee company. He also found that the export proceeds remained unrealized even after more than 15 years and there are allegations against the Director, Sh. Rakesh Mohan about the misappropriation of the company funds. Other group companies also seemed to be involved in foreign exchange violations. He also concluded on the basis of statement of Sh. R.K. Dixit, General Manager that the export proceeds were actually realized in U.K. by Sh. Rohit Sahu the then Executive Director of the Noticee Company in connivance and with active support of Sh. Rakesh Mohan. The misappropriation of export proceeds by Sh. Rohit Sahu was admitted by Sh. Rakesh Mohan. However, Sh. Rakesh Mohan has stated that Sh. Rohit Sahu did it alone without his support or knowledge. But the Adjudicating Authority was of the view that the sequence of events indicates contrary what Sh. Rakesh Mohan as stated. He also recorded that no attempt wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been prayed that revision may be allowed and the impugned order may be accordingly amended/modified by passing necessary orders for holding the respondents guilty and imposition of penalty against the noticees 2, 3, 5, 6, 7, 8, 10 and 11 who were also in-charge and responsible for the contravention committed by the offender company. 10. Sh. S.K. Kochhar, Advocate representing respondents 1, 2, 3 and 6 has submitted that the instant revision petition has been filed on 7-1-2009 against the Adjudication Order dated 28-9-2007 under Sec. 19(6) of FEMA, 1999. Submission is that the principle attack to the Adjudication Order is that all the directors, the respondents herein were also in-charge and were responsible to the company at the relevant time of commission of alleged contraventions. The revisionist has mainly relied upon Section 68 of the FERA, 1973. The burden rests on the Enforcement Directorate to establish beyond doubt that every person who at the time of commitment of contravention, was in-charge or was responsible for the company for conduct of business of the company. 'There is not an iota of evidence against the respondents to the effect that all or any of them we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be inferred against a company registered or incorporated under the Companies Act, 1956 only if the requisite statements, which are required to be afforded in the complain with petition, are make so as to make the accused therein vicariously liable for offence committed by the company. It has also laid down that vicarious liability on the part of a person must be pleaded and proved and not inferred. It has been held that if the accused is the Managing Director or Joint Managing Director of the company, then it is not necessary to make specific averments in the complaint and by virtue of their position they are liable to be proceeded. The judgment of the National Small Industries v. Harminder Singh has been followed in Umesh K. Modi v. Deputy Enforcement by Hon'ble Supreme Court in its order dated 31-7-2014 also relied upon by ld. Counsel for respondents. 12. In Puja Ravinder Devdasani v. State of Maharashtra and Anr. - (2014) 16 SCC 1, the Hon'ble Supreme Court in Para 17 of the judgment has held that Non-Executive Director is no doubt a custodian of the governance of the Company but is not involved in day-to-day affairs of the running of its business and only monitors the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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