Court dismisses petition challenging FERA exoneration order due to failure to pursue alternative remedies

The court dismissed the petition challenging the order of exoneration under FERA, 1973, finding that the petitioner had alternative remedies available through appeals, which were not pursued. The court emphasized that the petitioner had not challenged the Appellate Tribunal's order in the present petition and questioned the petitioner's locus standi, ultimately deeming the writ petition not maintainable.

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Issues:
Challenge to order of exoneration under FERA, 1973 by Enforcement Directorate and mandamus sought for fresh adjudication.

Analysis:
The petition challenged the order of the Enforcement Directorate dated 26th September, 2003 under the Foreign Exchange Regulation Act, 1973 (FERA) regarding the exoneration of respondent No.3 and respondent No.4. The order found the petitioner guilty of not repatriating sale proceeds into India but using them in the USA. It also noted that the respondents were removed from the company in 1984, thus holding them not liable for the contravention under Section 68(1) of the Act.

The respondents argued that the petitioner had appealed to the Appellate Tribunal against the order, which was dismissed on 28th May, 2010. They contended that the petitioner should have challenged the exoneration in the appeal itself and had the option of a second appeal to the High Court. The counsel for the Enforcement Directorate cited a Supreme Court judgment to emphasize the availability of alternative remedies like appeals.

The Appellate Tribunal, in its order dated 28th May, 2010, acknowledged the petitioner's argument that the respondents were wrongly exonerated. The petitioner claimed that the respondent No.4 continued to act as the Managing Director of the company, implying shared liability. However, the Tribunal rejected the argument of equal liability, stating that no claim for negative equality could be made.

The petitioner's counsel contended that the maintainability of the writ petition could not be questioned once notice was issued. However, the court rejected this argument, stating that the question of maintainability could be raised at any stage. The petitioner also argued that the appeal to the Appellate Tribunal was not the appropriate forum to challenge the exoneration, but the court disagreed, highlighting the similarity in appeal provisions under FERA and FEMA.

The court addressed the petitioner's contention that the appeal under FEMA only lies against orders imposing penalties, clarifying that the main provision allows appeals against any order made by the adjudicating authority, including exoneration orders. The court emphasized that the order in question was made under FERA, not FEMA. Since the petitioner had the option to appeal the Appellate Tribunal's decision but had not done so, the writ petition was deemed not maintainable.

In conclusion, the court dismissed the petition, noting that the petitioner had alternative remedies available through appeals and had not challenged the Appellate Tribunal's order in the present petition. The court also questioned the petitioner's locus standi to maintain the petition, highlighting the lack of merit in the case.

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