Separate foreign exchange contraventions can be assessed transaction-wise, with penalty reduced where judicial discretion warrants leniency.

Separate foreign exchange contraventions may be treated transaction-wise where the record shows distinct receipts and disbursements on different dates, even if they are described in a consolidated charge memo. Seized account books, the appellant's admissions, panch witness evidence, and corroborative documents were held sufficient to prove the breaches and to sustain the statutory burden on the appellant to explain the transactions and establish permission. The evidentiary objections did not displace that burden. The Court also noted that penalty discretion must be exercised judicially and reduced the aggregate penalty in view of the scale and circumstances of the transactions.

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Issues: (i) Whether a consolidated show-cause charge could sustain multiple contraventions and separate penalties where the receipts and disbursements were proved to have occurred on different dates and in different transactions; (ii) whether the seized account books, statements of the appellant, and corroborative material justified the finding of contravention notwithstanding objections to recovery and reliance on entries; (iii) whether the quantum of penalty required reduction in the circumstances of the case.

Issue (i): Whether a consolidated show-cause charge could sustain multiple contraventions and separate penalties where the receipts and disbursements were proved to have occurred on different dates and in different transactions.

Analysis: The record showed that the first charge concerned receipt of foreign exchange in nine instalments and the second charge concerned numerous disbursements to 51 persons. The memo and annexures were not merely omnibus allegations; they reflected separate transactions. The material proved that the consolidated amount was made up of distinct receipts and payments on different dates, and the appellant had himself admitted the relevant transactions. A memorandum describing the total amount did not prevent the authorities from treating each proved transaction as a separate contravention.

Conclusion: The multiple-transaction basis for penalty was upheld and the contention that only one penalty could be imposed on each consolidated charge was rejected.

Issue (ii): Whether the seized account books, statements of the appellant, and corroborative material justified the finding of contravention notwithstanding objections to recovery and reliance on entries.

Analysis: The seizure was supported by the testimony of panch witnesses who acknowledged their signatures on the recovery memo and the seized documents. The appellant did not establish that the documents were planted or belonged to someone else. The Court also held that the burden lay heavily on the appellant under the foreign exchange law to explain the transactions and show requisite permission, and that the entries in the books, statements of the appellant, and other related documents furnished sufficient proof of the contraventions. The objections based on section 34 of the Evidence Act did not displace the statutory burden and the presumption arising from the recovered material.

Conclusion: The findings of contravention were sustained and the evidentiary objections were rejected.

Issue (iii): Whether the quantum of penalty required reduction in the circumstances of the case.

Analysis: Although the contraventions were proved, the amounts involved in many individual instances were small. The Court accepted that the penalty provision conferred discretion and that sentencing had to be exercised judicially. Considering the scale of the transactions, the number of recipients, and the surrounding circumstances, the Court concluded that the interests of justice would be served by reducing the aggregate penalty.

Conclusion: The penalty was reduced by Rs. 1 lakh.

Final Conclusion: The appeal succeeded only to the extent of reduction of the aggregate penalty, while the findings of contravention and the basis for separate liability were maintained.

Ratio Decidendi: Where a foreign exchange contravention is proved through separate transactions supported by admissions, seized records, and corroborative material, the authority may assess liability transaction-wise, and the quantum of penalty is subject to judicially exercised discretion under the statutory maximum.

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