Appellate Tribunal for Foreign Exchange (ATFE)

The Appellate Tribunal for Foreign Exchange (ATFE) is a quasi-judicial body that hears appeals against orders passed by the Reserve Bank of India (RBI) or the Enforcement Directorate (ED) under the Foreign Exchange Management Act (FEMA), 1999. It was established to provide an independent platform for individuals and entities who wish to challenge decisions related to violations of foreign exchange regulations, such as breaches of the Liberalized Remittance Scheme (LRS) limit or other violations of FEMA.

Key Features of the Appellate Tribunal for Foreign Exchange (ATFE)

1. Purpose: The primary purpose of the ATFE is to provide an appellate mechanism for challenging orders passed by the RBI or Enforcement Directorate in matters related to FEMA violations, such as penalties, restrictions, and other enforcement actions.
2. Jurisdiction: The ATFE has jurisdiction to hear appeals against orders issued under FEMA by authorities like:
   • The Reserve Bank of India (RBI): In matters concerning remittances, foreign exchange transactions, and penalties.
   • The Enforcement Directorate (ED): In cases involving investigations into money laundering and violations of foreign exchange laws.
3. Nature of Appeals: Appeals before the ATFE are generally filed when an individual or entity wishes to challenge an order of:
   • Penalty imposed by the RBI or ED.
   • Violation of FEMA provisions, such as exceeding the prescribed remittance limits under the Liberalized Remittance Scheme (LRS).
   • Other orders issued by the authorities relating to foreign exchange regulations.

Legal Basis for the ATFE

The ATFE was constituted under Section 17 of the Foreign Exchange Management Act (FEMA), 1999. FEMA is the primary law governing foreign exchange transactions in India and provides the legal framework for the regulation of foreign exchange and international transactions, including remittances under the Liberalized Remittance Scheme (LRS).

Procedure for Filing an Appeal with ATFE

1. Eligibility to File an Appeal: Any individual, company, or entity who is aggrieved by an order passed by the Reserve Bank of India (RBI) or Enforcement Directorate (ED) under FEMA, and who believes that the order is incorrect or unjust, can file an appeal before the ATFE.
2. Timeframe for Filing an Appeal: The appeal must be filed within 45 days from the date on which the aggrieved party receives the order from the RBI or ED. The Appellate Tribunal may extend the period for filing an appeal by an additional 45 days, but this extension is granted only under special circumstances and at the discretion of the Tribunal.
3. Form of Appeal:
   • The appeal must be made in writing and should be in the prescribed format (as per the rules of the Tribunal).
   • The appellant must submit the original order passed by the RBI or ED, along with the grounds of appeal and any supporting documents that justify the appeal.
   • Payment of Fees: A fee must be paid at the time of filing the appeal, which varies based on the nature of the appeal.
4. Appeal Hearing:  Once the appeal is filed, the ATFE will review the petition and schedule a hearing. The parties involved (appellant and the authority that passed the order) will be given an opportunity to present their arguments. This may include submissions of legal arguments, evidence, and any other material that supports the appeal.
5. Decision: The ATFE will pass an order after hearing the appeal. The Tribunal has the power to:
   • Confirm the order passed by the RBI or ED.
   • Modify the order.
   • Set aside the order, either in full or in part.

Appeal Process in Case of Dissatisfaction with ATFEs Decision

If an individual or entity is not satisfied with the decision made by the Appellate Tribunal for Foreign Exchange (ATFE), they have the option to challenge the ATFE’s order in the High Court under Article 226 of the Constitution of India.

1. Jurisdiction of High Court: The appeal to the High Court is typically filed on the grounds of illegalities, unreasonableness, or procedural irregularities in the ATFE’s decision.
2. Time Limit: The appeal to the High Court must be filed within 60 days from the date the ATFE passes its final order.

Composition of the ATFE

The Appellate Tribunal for Foreign Exchange consists of a Chairperson and two other members, who are typically experts in the fields of law, finance, and foreign exchange regulations. These members are appointed by the government. The decisions of the Tribunal are made collectively by these members.

Where to Appeal and Filing Process

The appeal can be filed with the ATFE located in New Delhi. The physical or online filing process involves submitting the required documents, paying the prescribed fees, and adhering to the procedural rules laid down by the Tribunal.

Conclusion

The Appellate Tribunal for Foreign Exchange (ATFE) provides a crucial avenue for individuals and entities to seek redressal if they believe an order passed by the RBI or Enforcement Directorate (ED) under FEMA is unjust or incorrect. It serves to ensure that the enforcement of foreign exchange laws in India is fair and just, and gives aggrieved parties an opportunity to challenge decisions that may adversely affect them. However, parties must comply with strict timeframes for filing appeals, and the appeal process is subject to the rules and regulations set by the Tribunal. If not satisfied with the ATFE’s decision, further appeal can be made to the High Court.