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TMI Blog2023 (7) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... of time of the three appeals. 3. FEA No. 5 of 2008 had been filed prior to the other two appeals and for the sake of convenience is hereinafter referred to as the first appeal. The appellants in FEA 22 of 2009 and FEA 23 of 2009 have been represented by a different learned counsel. These two appeals, for the sake of convenience have been referred to as the next sets of appeals. 4. Learned advocate appearing for the appellants in the first appeal has drawn the attention of the Court to the facts of the present case. He has submitted that the memorandum dated March 31, 2002 was issued to the appellants on May 31, 2002. He has referred to the stand taken by the appellants both before the adjudicating officer as also at the subsequent stage before the appellate authority that, the memorandum was issued on June 1, 2002 and therefore, beyond period prescribed by the sun set clause. 5. Learned advocate appearing in the first appeal has referred to Section 49 of the Foreign Exchange Management Act, 1999 (FEMA) and in particular Section 3 thereof and contended that, beyond May 31, 2002 provisions of Foreign Exchange Regulation Act, 1973 (FERA) cannot be invoked. He has referred to the me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ings with regard to the so-called violation of the terms of the license. In fact, Reserve Bank of India had renewed the license. Therefore, there was no valid ground for the authorities to initiate the proceedings under FERA. He has contended that the impugned action of the authority suffers from non-application of mind. 10. Learned advocate appearing for the department in the first appeal has contended that the memorandum is dated May 31, 2002. Since the Foreign Exchange Management Act, 1999 (FEMA) had come into effect from June 1, 2002 therefore, actions taken as on May 31, 2002 with regard to FERA was valid. He has contended that, the adjudicating officer took notice of the infractions and initiated proceedings on the basis of the memorandum dated May 31, 2002. Therefore, the proceedings were initiated validly within the time period prescribed. He has referred to the Adjudication Proceedings and Appeal Rules, 1974 and in particular to Rule 3 thereof, in support of his contention. He has referred to the contents of the memorandum dated May 31, 2002 and contended that the adjudicating officer was conscious of the provisions of Section 9 (3) of the Act of 1999 and gave reasonable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the scope of the show cause notice dated March 31, 2002. 14. Relying upon 2014 Volume 5 Supreme Court Cases 162 (Tulip Star Hotels Ltd. Vs. Special Director of Enforcement) learned advocate appearing for the appellants in the next set of appeals has contended that, since the noticee sold the foreign currencies after following the instructions of the RBI, the noticees cannot be made responsible for the intended purpose of the purchaser or the misuse of such funds by the purchasers. 15. Learned advocate appearing for the Department in the next set of appeals has adopted the contentions of the department in the first appeal. In addition, he has submitted that, the appellants had violated various provisions of the guidelines issued by Reserve Bank of India. He has highlighted the fact that, the foreign currencies were sold by the appellants on numerous occasions to same natural persons within a short period of time. Therefore, the appellants had failed to take reasonable care and adhere to the guidelines of the Reserve Bank of India. 16. In the first appeal, the appellants had been issued a memorandum dated May 31, 2002. An Adjudication Order dated December 15, 2004 had been passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l take cognizance of an offence under the repealed Act and no adjudicating officer shall take notice of any contravention under section 51 of the repealed Act after the expiry of a period of two years from the date of the commencement of this Act. (4) Subject to the provisions of sub-section (3) all offences committed under the repealed Act shall continue to be governed by the provisions of the repealed Act as if that Act had not been repealed. (5) Notwithstanding such repeal,- (a) anything done or any action taken or purported to have been done or taken including any rule, notification, inspection, order or notice made or issued or any appointment, confirmation or declaration made or any licence, permission, authorisation or exemption granted or any document or instrument executed or any direction given under the Act hereby repealed shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provisions of this Act; (b) any appeal preferred to the Appellate Board under sub-section (2) of section 52 of the repealed Act but not disposed of before the commencement of this Act shall stand transferr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence had centered around construction of Sections 110 (2), 124 and 153 of the Customs Act. 23. Shri Kanti Tarafdar (supra) has construed the provisions of Section 110, 124, and 153 of the Customs Act. It has held that, service of a notice as contemplated under such provisions of the Customs Act, will be complete either by tendering or by sending the same by registered post, since the Legislature has equated both the situations by using the word "or". 24. The ratio of the two authorities noted above, is not attracted to the facts and circumstances of the present case as, the provisions of Section 49 (3) of the Act of 1999 are not pari materia with the provisions of Sections 110, 124 and 153 of the Customs Act. 25. M/s M. M. Rubber and Co. Tamil Nadu) (supra) has dealt with provisions of Section 35-E (3) of the Central Excise and Salt Act, 1944. It has held that, an order or a decision comes into force from the date it is passed and the concerned authority loses the power to change it. However, the commencement of limitation period depends upon the intention of relevant statutory provision. If the intention is to provide a remedy to the person adversely affected, the statutory p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice of a notice on the noticee. What it requires is that, the adjudicating officer must take notice of the contraventions of Section 51 of the Act of 1973 within the time period specified. The department needs to establish that, the Adjudicating Officer took notice of the contraventions under Section 51 of the Act of 1973 within the time period prescribed. 30. In the facts and circumstances of the present case, the memorandum is dated May 31, 2002 which has recorded the fact that the Adjudicating Officer took notice of the contraventions of Section 51 of the Act of 1973 by the appellants. The appellants have not produced any materials on record to establish that, the memoranda were not dated May 31, 2002. The Department has discharged its burden of proof by producing a letter dated May 31, 2002, which signifies that the Adjudicating Officer took notice of the contraventions of Section 51 of the Act of 1973 by the appellants, within the period of limitation prescribed by the Act of 1999. The appellants have not produced any evidence to rebut the same. 31. In First Global Stockbroking (P) Ltd (supra) the authorities had initiated proceedings under the Act of 1973 by a person who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... struction of a taxing statute is the mandate. Liberal construction to effectuate the object of the provision may be resorted to, only in case of genuine doubt or possibility of forming two alternative options. 36. It has been contended that, Section 49 (3) of the Act of 1999 requires fulfilment of both the conditions prescribed therein namely Court Taking cognizance of an offence under the Act of 1973 and the Adjudicating Officer taking notice of the contraventions under Section 51 of the Act of 1973, within a period of 2 years of the Act of 1999 coming into force. In other words, the appellants have contended that, both, the Adjudicating Officer must take notice as also a Court of law must take cognizance of the contravention within May 31, 2002 for proceedings under the Act of 1973 to continue subsequent to the coming into effect of the Act of 1999. 37. Sub Section (3) of Section 49 of the Act of 1999 casts an embargo upon a Court from taking cognizance of an offence under the Act of 1973 and on the Adjudicating Officer from taking notice of any contravention under Section 51 of the Act of 1973, after the expiry of a period 2 years from the date of commencement of the Act of 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the guidelines of the Reserve Bank of India in selling foreign currency to those persons. It has been concurrently held that, the appellants had failed to discharge their duty of reasonable care in selling foreign currencies to those persons involved when such currencies were sought for within such a short period of time with same dates of travel. 43. In all the three appeals, there have been on current finding on facts. The adjudicating officer in all the proceedings had found violations of the guidelines of the Reserve Bank of India by the appellants, in their dealings with the sale of foreign currency to the delinquents. The findings returned by the adjudicating officer and by the appellate authority on such factual aspects have not been established to be perverse in these appeals. 44. In such circumstances, the ratio of Ballarpur Industries Ltd. (supra), Brindavan Beverages (P) Ltd (supra) and Tulip Star Hotels Ltd (supra) are not attracted in the facts and circumstances of the case involved in the next two appeals. 45. In view of the discussions above, the appeals FEA 5 of 2008, FEA 22 of 2009, FEA 23 of 2009 being without any merit are dismissed without any order as to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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