Court upholds constitutionality of FERA and FEMA sections, dismissing challenge.

The court upheld the constitutionality of Sections 18(2) and 18(3) of FERA and Section 49(4) of FEMA, dismissing the writ petition challenging the legality of these provisions. The court found that the statutory presumptions and reverse burdens imposed were procedural and not unconstitutional, emphasizing the rebuttable nature of the presumption against exporters for non-repatriation. Additionally, it was highlighted that FERA is protected under Article 31-B of the Constitution, and Acts in the Ninth Schedule cannot be deemed ultra vires. The petitioner was directed to pay costs, with other pleas on merit to be addressed before the Appellate Tribunal for Foreign Exchange.

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Issues:
Challenge to constitutionality of Sections 18(2) and 18(3) of FERA and Section 49(4) of FEMA.

Analysis:
1. The petitioner filed a writ petition seeking to quash a show cause notice and an adjudication order based on the alleged unconstitutionality of Sections 18(2) and 18(3) of FERA and Section 49(4) of FEMA. The petitioner exported goods but faced issues with non-repatriation of sale proceeds, leading to penalty imposition.

2. The petitioner contended that the provisions of FERA and FEMA are arbitrary and irrational, placing an impossible burden on exporters to ensure full repatriation of proceeds. The petitioner challenged the legality of these sections due to the presumption created against exporters for non-repatriation.

3. The petitioner argued that the presumption of non-repatriation due to any shortfall, even of one rupee, is unreasonable and places an unfair burden on exporters. The petitioner claimed that this presumption is unconstitutional and impossible to fulfill, invoking the maxim lex neminem cogit ad vana seu inutilia peragenda.

4. The court held that the impugned provisions of FERA do not mandate impossible acts but merely raise a rebuttable presumption against exporters. The court found the provisions valid and cited a previous Supreme Court judgment upholding the constitutionality of Sections 18(2) and 18(3) of FERA.

5. The Supreme Court judgment emphasized that the burden of proof in legal provisions is procedural and not unconstitutional solely due to a reverse burden. The court highlighted that statutory presumptions and reverse burdens exist in various statutes and can be rebutted by the accused.

6. Additionally, it was noted that FERA is protected under Article 31-B of the Constitution, and Acts in the Ninth Schedule cannot be held ultra vires even if they conflict with fundamental rights. The court dismissed the writ petition, directing the petitioner to pay costs and stating that other pleas on merit should be addressed before the Appellate Tribunal for Foreign Exchange.

In conclusion, the court upheld the constitutionality of Sections 18(2) and 18(3) of FERA and Section 49(4) of FEMA, dismissing the writ petition and emphasizing the procedural nature of burden of proof in legal provisions.

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