Cross-examination waiver and failure to prove lawful possession sustained FERA contraventions, penalties, and confiscation

A remand for fresh enquiry nullified the earlier adjudication, so the prior appellate exoneration did not bar renewed proceedings. Where cross-examination was offered during remand but deliberately not pursued, the party could not later claim procedural prejudice on that ground. The seizure of currency and documents, together with the statement and surrounding circumstances, was treated as sufficient to establish contraventions under FERA because the appellant failed to prove lawful possession or a lawful source for the seized amount. On that footing, the penalties and confiscation were sustained as commensurate with the proved contraventions.

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Issues: (i) whether the adjudication stood vitiated for want of opportunity to cross-examine the mahazar witnesses and the officer who recorded the appellant's statement; (ii) whether the earlier appellate order exonerating the appellant could bar fresh adjudication after remand by the High Court; (iii) whether the seizure, statement, and surrounding material established contraventions of Section 9(1)(b), Section 9(1)(d), and Section 64(2) read with Section 9(1)(d) of the Foreign Exchange Regulation Act, 1973; and (iv) whether the penalties and confiscation were justified.

Issue (i): whether the adjudication stood vitiated for want of opportunity to cross-examine the mahazar witnesses and the officer who recorded the appellant's statement

Analysis: The opportunity for cross-examination had been made available during the remand proceedings. The witnesses had been summoned, and the appellant's counsel chose not to pursue cross-examination and instead requested decision on written submissions. In those circumstances, the Tribunal held that the appellant could not later complain that the proceedings were vitiated for denial of cross-examination.

Conclusion: The adjudication was not vitiated on this ground.

Issue (ii): whether the earlier appellate order exonerating the appellant could bar fresh adjudication after remand by the High Court

Analysis: The High Court had remitted the matter for a fresh enquiry and adjudication in accordance with law. A fresh enquiry meant that the earlier adjudication stood set aside and replaced. Consequently, the earlier appellate decision passed against that original adjudication could not survive to restrict the fresh adjudication on remand.

Conclusion: The earlier exoneration did not survive and could not prevent fresh adjudication.

Issue (iii): whether the seizure, statement, and surrounding material established contraventions of Section 9(1)(b), Section 9(1)(d), and Section 64(2) read with Section 9(1)(d) of the Foreign Exchange Regulation Act, 1973

Analysis: The seizure of currency and documents, the explanation contained in the appellant's statement, and the surrounding circumstances supported the allegation of compensatory payments. The appellant failed to prove a lawful source for the seized amount or satisfactorily explain its possession. The Tribunal held that the burden to establish lawful possession remained on the appellant and that the attempt to make payment was also made out.

Conclusion: The contraventions were established.

Issue (iv): whether the penalties and confiscation were justified

Analysis: The statutory power permitted penalties up to five times the amount or value involved in the contravention. In view of the amounts involved and the proved contraventions, the penalties and confiscation were treated as commensurate and warranted.

Conclusion: The penalties and confiscation were upheld.

Final Conclusion: The impugned order was sustained in full, with the appeal failing on all substantive grounds.

Ratio Decidendi: Where an opportunity for cross-examination is available but is consciously not pursued, and the appellant fails to discharge the burden of proving lawful possession of seized currency, the adjudicating authority may rely on the seizure and surrounding material to sustain contraventions and impose penalties and confiscation under FERA.

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