2018 (9) TMI 669 - AT - FEMA

Dismissed appeal requires refiling with Special Director (Appeals) under FEMA, not subject to time limitations.

The appeal was dismissed, directing the appellant to file before the Special Director (Appeals) under FEMA jurisdiction, following the transition from ... Appeal to Special Director (Appeals) - Jurisdiction of Appellate Tribunal - Transference of appeals from FERA to FEMA - Deemed continuation of actions under FERA as under FEMA - Limitation not to operate where appeal was timely filed before the Tribunal/Appellate BoardAppeal to Special Director (Appeals) - Jurisdiction of Appellate Tribunal - Transference of appeals from FERA to FEMA - Deemed continuation of actions under FERA as under FEMA - Appeal against an adjudication order passed by an Assistant Director/Deputy Director of Enforcement is maintainable before the Special Director (Appeals) and not before the Appellate Tribunal. - HELD THAT: - Section 17(2) of FEMA provides that persons aggrieved by orders of an Assistant Director or Deputy Director of Enforcement may prefer an appeal to the Special Director (Appeals). Applying the legislative scheme effected by FEMA, and following the reasoning in Premier Limited v. Union of India, the repeal of FERA and constitution of FEMA did not leave appeals which were previously maintainable before the Appellate Board to remain before the Tribunal where FEMA has established two appellate fora. Actions and adjudication orders under FERA are to be treated as having been taken under corresponding provisions of FEMA, and consequently appeals against adjudication orders by Assistant/Deputy Directors under FERA are to be instituted before the Special Director (Appeals) under FEMA rather than before the Appellate Tribunal.The appeal before the Appellate Tribunal is not competent and appeals against orders of Assistant/Deputy Directors of Enforcement must be filed before the Special Director (Appeals).Limitation not to operate where appeal was timely filed before the Tribunal/Appellate Board - Filing of the appeal before the Tribunal/Appellate Board within time preserves the appellant's right to file afresh before the Special Director (Appeals) without being barred by limitation. - HELD THAT: - The Tribunal dismissed the appeal for lack of jurisdiction but granted liberty to the appellant to institute the appeal before the Special Director (Appeals). The Tribunal recorded that, because the appeal was originally filed in time before the Tribunal/Appellate Board, the period for limitation will not be a bar if the appellant institutes the appeal before the Special Director (Appeals). This protects the appellant from a limitation defence solely because of the change in competent forum arising from the transition from FERA to FEMA.Appeal dismissed for want of jurisdiction with liberty to the appellant to file the same before the Special Director (Appeals); limitation will not be a ground for rejection if so filed.Final Conclusion: The appeal before the Appellate Tribunal is dismissed for lack of jurisdiction; the appellant is granted liberty to file the appeal before the Special Director (Appeals) and, since the appeal was timely filed before the Tribunal/Appellate Board, the defence of limitation shall not apply to such refiling. Issues: Jurisdiction of appeal under FEMAAnalysis:The judgment revolves around the jurisdiction issue raised by the respondent's counsel regarding the appeal process under FEMA. The respondent argued that since the impugned adjudication order was issued by the Deputy Director, the appeal should be directed to the Special Director (Appeals) as per Section 17 of FEMA. On the other hand, the appellant contended that since the appeal was initially filed under FERA before the enactment of FEMA, it should be heard by the Tribunal as FERA did not provide for appeals to the Special Director (Appeals). The Tribunal examined Section 17(2) of FEMA, which clearly states the procedure for appeals against orders made by the Adjudicating Authority.The judgment referred to a significant decision by the Bombay High Court in the case of Premier Limited vs. Union of India, where the court addressed the transition from FERA to FEMA and the implications on appeal procedures. The court emphasized that with the establishment of FEMA, all appeals against adjudication orders, whether under FERA or FEMA, should be directed to the appellate forums constituted under FEMA. The court highlighted the provisions of Section 49(5) of FEMA, which deem actions taken under FERA to be under the corresponding provisions of FEMA. Consequently, adjudication orders under FERA by the Assistant Director/Deputy Director of Enforcement are considered orders under FEMA, making appeals against them maintainable before the Special Director (Appeals).In conclusion, the judgment dismissed the appeal, directing the appellant to file it before the Special Director (Appeals) in compliance with the jurisdictional requirements under FEMA. The dismissal was accompanied by the liberty for the appellant to re-file the appeal before the appropriate authority. Importantly, the issue of limitation was addressed, clarifying that the timely filing of the appeal with the Tribunal/Appellate Board would not pose a limitation issue if re-filed before the Special Director (Appeals). The judgment thus provides a clear interpretation of the jurisdictional framework for appeals under FEMA, ensuring adherence to the statutory provisions and legal precedents.