TMI Blog2022 (5) TMI 241X X X X Extracts X X X X X X X X Extracts X X X X ..... ttled that every infraction of the principles of natural justice or procedure stipulated for adjudication would not vitiate a proceeding. The petitioner has to demonstrate actual and real prejudice The two tier procedure under Rule 4 which warrants a preliminary enquiry to form an opinion before the process of actual adjudication, may have laudable objects given the very serious civil consequences. The need of demonstration of prejudice due to infraction of such procedure would still be necessary to vitiate the proceedings, and would not otherwise be given a go-by merely because of codification of principles of natural justice into separate Rules in the Foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000. Sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the provisions of 16(3) of the Foreign Exchange Management Act, 1999. In terms of Para 11 thereof, the petitioner was asked to appear in person or through legal practitioner to explain and produce documents or evidence as may be useful for the subject of enquiry. Prior thereto, a complaint was sent on the same date by the Assistant Director to the Adjudicating Authority as regards a series of complaints detailing failure on the part of the petitioner to bring back foreign exchange - being export proceeds - to the extent of about seven thousand crores. Mr. Samir Chakraborty, learned Senior Advocate appearing for the petitioner would argue that the adjudicating authority did not follow the procedure prescribed in Rule 4(1) and 4(2) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il prison and prosecution. The facts of the instant case are rather different. The decision of Natwar Singh (Supra) was dealing with transactions in foreign exchange totally away from the Indian shores. The decision of Shashank Vyankatesh Manohar (supra) was dealing with a case of a widely published cricket tournament. In the instant case, failure to bring back export proceeds to the extent of seven thousand crores arose out of loan transactions between the petitioner and his entities and about 23 banks. It is now well settled that every infraction of the principles of natural justice or procedure stipulated for adjudication would not vitiate a proceeding. The petitioner has to demonstrate actual and real prejudice. Reference in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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