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Issues: (i) whether opportunity notice contemplated under the proviso to Section 61(2)(ii) of the Foreign Exchange Regulation Act was issued to A-1 to A-3; (ii) whether prior permission under Section 18(2) of the Foreign Exchange Regulation Act was obtained from the Reserve Bank of India; (iii) whether A-4 to A-6 contravened Section 18(3) of the Foreign Exchange Regulation Act; and (iv) whether the acquittal required interference.
Issue (i): whether opportunity notice contemplated under the proviso to Section 61(2)(ii) of the Foreign Exchange Regulation Act was issued to A-1 to A-3.
Analysis: The record contained the opportunity notice issued before prosecution. Even otherwise, the governing principle is that where an accused had already been afforded an opportunity in the adjudication process, non-issuance of a fresh opportunity notice does not vitiate the prosecution. The trial court's contrary finding was inconsistent with the record.
Conclusion: The issue is answered against the accused and in favour of the Revenue.
Issue (ii): whether prior permission under Section 18(2) of the Foreign Exchange Regulation Act was obtained from the Reserve Bank of India.
Analysis: The evidence showed that export proceeds beyond the stipulated period were not realised and no material established that extension of time or prior permission had been obtained from the Reserve Bank of India. In the absence of any reliable defence proof, the statutory requirement remained unfulfilled.
Conclusion: The issue is answered against the accused and in favour of the Revenue.
Issue (iii): whether A-4 to A-6 contravened Section 18(3) of the Foreign Exchange Regulation Act.
Analysis: The quotas of A-4 to A-6 were utilised for exports by A-1 to A-3, the relevant declarations were jointly signed, and letters were given to the bankers for credit of export proceeds. Once their quotas were used and export realisation was not ensured, A-4 to A-6 could not avoid responsibility under the statutory scheme requiring reasonable steps for recovery of sale proceeds.
Conclusion: The issue is answered against the accused and in favour of the Revenue.
Issue (iv): whether the acquittal required interference.
Analysis: The trial court's conclusions were found to be based on errors of law and appreciation of evidence and were held to be perverse. In an appeal against acquittal, interference is justified where the findings are manifestly illegal or no reasonable view supports them.
Conclusion: The acquittal was liable to be set aside.
Final Conclusion: The judgment of acquittal was reversed, the accused were convicted for the charged offences, and sentence with fine was imposed.
Ratio Decidendi: In an appeal against acquittal, interference is warranted where the trial court's view is perverse or legally unsustainable, and non-issuance of a fresh opportunity notice does not vitiate prosecution when an effective opportunity was already afforded in the adjudicatory process.
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