Pendency of appeal does not bar prosecution; appellate and criminal proceedings must be managed harmoniously under the exchange law.

Pendency of an appeal under section 52 of the Foreign Exchange Regulation Act, 1973, even with an application to dispense with pre-deposit, does not by itself bar prosecution under section 57. The appeal and the criminal prosecution operate in different spheres, so the prosecution remains maintainable unless affected by later appellate findings. The court emphasised a harmonious construction of the statutory scheme: the appellate authority should decide any dispensation request expeditiously, while the criminal court retains discretion to regulate trial timing and take subsequent appellate orders into account where relevant. Neither remedy should be rendered ineffective by delay.

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Issues: (i) Whether the pendency of an appeal and an application for dispensing with pre-deposit under section 52 barred prosecution under section 57 of the Foreign Exchange Regulation Act, 1973; (ii) whether the appellate authority and the criminal court should regulate their proceedings so that neither the statutory appeal nor the prosecution is rendered ineffective.

Issue (i): Whether the pendency of an appeal and an application for dispensing with pre-deposit under section 52 barred prosecution under section 57 of the Foreign Exchange Regulation Act, 1973.

Analysis: The right of appeal under section 52 and the power to prosecute under section 57 operate in different spheres. Pendency of the appeal, even with an accompanying request to dispense with pre-deposit of penalty, does not by itself suspend or invalidate the prosecution. The criminal court may, in an appropriate case, regulate the timing of the criminal trial by exercising judicial discretion, but the prosecution is not rendered incompetent merely because the appellate proceedings are pending.

Conclusion: The prosecution under section 57 was maintainable and was not barred as premature merely because proceedings under section 52 were pending.

Issue (ii): Whether the appellate authority and the criminal court should regulate their proceedings so that neither the statutory appeal nor the prosecution is rendered ineffective.

Analysis: The statutory scheme requires a harmonious construction so that the appellate remedy, including the application to dispense with pre-deposit, is not rendered illusory and the enforcement power under section 57 is not frustrated. The appellate board must deal with such applications within a reasonable time, and the criminal court may take subsequent appellate findings into account if they affect the basis of the prosecution. Administrative delay in the appellate process cannot be used to defeat either side's statutory rights.

Conclusion: The court held that both remedies must be worked out harmoniously, with the appellate authority acting expeditiously and the criminal court retaining discretion to respond to subsequent appellate orders.

Final Conclusion: The appeal succeeded, the writ petition was dismissed, and the impugned directions restraining further prosecution were set aside while preserving the criminal court's discretion and the appellate board's duty to decide the pending application promptly.

Ratio Decidendi: Pendency of a statutory appeal with an application for dispensation of pre-deposit does not bar prosecution for non-compliance with the adjudication order, but the statutory appeal and prosecution must be construed and administered harmoniously so that neither remedy is rendered ineffective.

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