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2019 (3) TMI 824

behalf of his friend Madan, a person resident outside India - penalty imposed - HELD THAT:- From the documents/statements the Investigating Officer became aware of the identity of various persons from whom Shri Harish Kumar had been receiving payments in India, under instructions of his friend Madan, residing in USA, who was earlier residing in Mohali. In view of other certain searches were conducted and a number of persons examined and their statements recorded under FEMA, which brought out corroboratory evidence viz-a-viz the facts as stated by Shri Harish Kumar in his afore-mentioned statements. - Shri Harish Kumar later on sought to retract from his abovementioned statements, by way of a letter sent during the course of investigations, besides by way of submissions made during the course of personal haring including in the form of Affidavits, both his as also of one other person, in which Affidavit, it is claimed that amount totaling to ₹ 26,25,000/- was received by Shri Harish Kumar from the said person (Harchand Singh) on interest for using the same in his business of Goldsmith. - It is correctly found in the impugned order that from the seized material and the .....

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ces to make the pre-deposit of the penalty. - There is no material on record on behalf of the respondent to show that the appellant is not suffering from the undue hardship. It appears from the record, there is no contrary evidence available. The appellant is exempted to deposit the penalty amount. The same is waived in view of the peculiar facts of the present case. The impupgned order is modified only to this extent of penalty component. - FPA-FE-25/Patiala/2012 - 8-3-2019 - Justice Manmohan Singh Chairman For the Appellant : Shri T.K. Gadoo, Advocate For the Respondent : Ms. Aagam Kaur, Legal Consultant JUDGEMENT FPA-FE-25/Patiala/2012 1. By this order, I propose to decide the above-mentined appeal filed against the order dated 16.10.2012. 2. By the impugned order, the penalty ₹ 25,00,000/- (Rs. Twenty- Five Lakhs only) were imposed. 3. Facts are recorded in the impugned order, the same reads as under: (a) During the year 2003, an information was received in Jalandhar Zonal office of the Directorate of Enforcement that one Shri Harish Kumar @ Rinku S/o Shri Kanwar Bhan, R/o H.No. 1969, Sanatan Dharam Mandir, Rajpura Town, District Patiala (Punjab) was indulging in rece .....

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iding abroad; that in these two fax messages names and addresses of 21 persons were written from the relatives of whom the fax messages names and addresses of 21 persons were written from the relatives of whom the said Mandan had collected foreign exchange in U.S.A and to these 21 persons a total of ₹ 31,27,000/-was to be distributed; that when asked that as per the fax message he had to distribute total amount of ₹ 31,27,000/- whereas an amount of ₹ 21,75,000/- was seized from his residence, he stated that he was to receive more money from U.S.A under instructions of Madan; an average he was receiving about ₹ 40 lacs per month under the instructions of Madan residing in U.S.A and distributing the same to the persons in India as per the details sent by Madan; that he used to finalize the accounts of above transactions in the end of every month. While explaining the seized loose sheets marked 1 to 10 and the Diary containing written pages 1 to 10 recovered and seized from his residence he stated that these contained the detailed accounts of receipt and distribution of Hawala Payments; that page No. 7 of the seized loose sheets contained Account No. 181-3-6114 .....

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Delhi were searched under Section 37 of Foreign Exchange Management Act, 1999 read with Section 132 of Income Tax Act, 1961, and as a result thereof, a document, viz one loose sheet was recovered and seized from the above-mentioned business premises of the said Shri Harvinder Ahuja @ Happy. (d). Statement of Shri Om Prakash Ahuja S/o Shri Gobind Ram Ahuja was recorded on 13.01.2004, in which he interalia stated that he did not know about the Accounts written in the Document seized from their business premises and that his son Shri Harvinder Ahuja @ Happy was one of the Directors in M/s Om Forex. Statements of Shri Harvinder Ahuja @ Happy S/o Shri Om Prakash Ahuja was recorded on 13.01.2004 and 03.02.200, in which he, inter-alia, stated that he was running a Company in the name of M/s Om Forex Pvt. Ltd. from Gaffar Market, Karol Bagh, Delhi which dealt in sale/purchase of foreign exchange, in which he and his father Shri O.P. Ahuja were Directors; that phone No. 25850156, 25755249 were installed at his Residence; Phone No. 25767036, 25801182 were installed at his Shop and his Mobile number was 35002900; that he knew Harish Kumar @ Rinku who was residing in Punjab; that he had given .....

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in recorded on 15.3.2005 in which he reiterated the facts as stated in his statement dated 10.01.2004 and again confirmed that the person named Madan mentioned in his statement dated 10.01.2004 was residing in U.S.A and his Telephone No. was 4089464843. Besides, he stated interalia that Page No. 5 (left side) of the seized Diary contained details of amount totaling to ₹ 29,55,000/- received in India from one Shri Harvinder Ahuja @ Happy, as per instructions of Madan of U.S.A; that on the back side of Page No. 5 were also written the details of amount of ₹ 1,47,19,850/- received from Shri Harvinder Ahuja @ Happy, as per instructions of Madan of USA, and the same were distributed of different persons in India; that he used to destroy the fax messages; that he had written the accounts in this Diary in the shape of current account so that in case of seizure of these papers, the details of the persons to whom he had distributed the money had been written but the complete details of the persons to whom the money had been distributed was not mentioned in this diary; that the amounts written on the left/right side of the diary had been received by him for distribution from the .....

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of various payments on the instructions of their relatives working abroad. Their statements also do not have any evidentiary value as none of them could identify the appellant from whom, as per the respondent, they should have received their respective payments if the respondent had not seized the amount of ₹ 21,75,000/- from the appellant. Even though the Ld. Adjudicating Authority knew from appellant s statements and documents seized, the identity of various persons from whom the appellant had been receiving payments in India, he has not made any efforts for a joint trial of the appellant with those identified by the Ld. Adjudicating Authority which fact is evident in his own finding under para 13 of the impugned order at pp. 30 of the Paper Book. Had they been jointly tried with the appellant, the allegation of receiving payment could have been substantiated with adequate evidence. 7. It is true that the appellant had retracted his statements during the course of investigations as they have been recorded forcefully under the dictation of Shri Balvinder Singh, Enforcement Officer. 8. It is stated on behalf of appellant that as the statements were recorded under the signatu .....

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through the pleadings, documents and impugned order. It is an undisputed and unrebutted fact that based upon specific information that the said Shri Harish Kumar had been engaged in undertaking financial transactions of receiving and making of payments in India under instructions of persons resident outside India, search of his residential premises was conducted on 10.01.2004 and as a result thereof incriminating documents besides Indian currency aggregating to ₹ 21,75,000/- was recovered and seized by the Officers to Directorate of Enforcement, Jalandhar. 13. Shri Harish Kumar was examined by Shri B.C. Mahey, the then Assistant Director, Directorate of Enforcement, Jalandhar, after conclusion of search, and his statement recorded under the relevant provisions of FEMA, based upon the documents and Indian Currency recovered and seized from his residence, on 10.01.2004 itself. 14. In his statement, Shri Harish Kumar has mentioned facts which were in his knowledge, which could not have been extracted from him, besides providing explanation to the contents of the seized documents, as also with regard to the seized Indian currency. 15. In this statement as also in his subsequent .....

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rs 2002 and 2003, the said Shri Harish Kumar @ Rinku. It is correctly come to the conclusion in the impugned order that the Noticee, had, without any general or special permission of Reserve Bank, received amounts totaling to ₹ 2,47,99,350/-, in India, otherwise then through an authorized person, by order or on behalf of his friend Madan, a person resident outside India, and thereby he has contravened the provisions of Section 3 (c ) of the Foreign Exchange Management Act, 1999, to the extent as above, and I further find that the seized amount of ₹ 21,75,000/- was the amount involved in afore-mentioned contraventions of the provisions of FEMA. It is also a matter record that the appellant had retracted his admission after the expiry of almost more than four years. The said period is long period of time. It is after thought thus has no value in the eyes of law. 21. Therefore the penalty is rightly imposed upon the said Shri Harish Kumar @ Rinku penalty of ₹ 25,00,000/- (Rupees Twenty-Five Lakh Only), for the above-mentioned contraventions as well as recovery of the Indian Currency of ₹ 21,75,000/-, from his residential premises on 10.01.2004. The amount is al .....

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