2008 (12) TMI 849 - AT - FEMA

Appeal Partially Allowed: Penalty Reduced in Foreign Exchange Regulation Case, Dismissal of Coercion Claims Affirmed.

E. Fathima Beevi Versus Director, Enforcement Directorate

E. Fathima Beevi Versus Director, Enforcement Directorate - TMI Issues:1. Penalty imposed for contravention of section 9(1)(b) of the Foreign Exchange Regulation Act, 1973.2. Validity of the confessional statement obtained during investigation.3. Application of retracted confessional statement as evidence.4. Compliance with statutory regulations and imposition of penalty.Analysis:1. The judgment by the Appellate Tribunal for Foreign Exchange addressed an appeal against a penalty imposed for contravention of section 9(1)(b) of the Foreign Exchange Regulation Act, 1973. The appellant, E. Fathima Beevi, received an amount of Rs. 1,00,000 on instructions of her husband, a person resident outside India, without permission from the Reserve Bank of India. The penalty of Rs. 35,000 was adjusted from the blocked amount in the appellant's account. The appellant did not appear, and the appeal was decided based on available facts and evidence.2. The confessional statement obtained during the investigation was a key point of contention. The appellant claimed the statement was retracted and obtained under coercion. However, the Tribunal found the retraction unsubstantiated and referred to legal precedents emphasizing the voluntary nature of statements obtained by enforcement authorities. The burden of proof lay with the appellant to demonstrate coercion, which was not established.3. The judgment discussed the admissibility of retracted confessional statements as evidence. Citing legal principles, the Tribunal highlighted that a retracted confession could be relied upon if corroborated sufficiently. In this case, the physical seizure of incriminating documents and circumstantial evidence corroborated the appellant's statement, indicating the truthfulness of the confession.4. The Tribunal emphasized the importance of compliance with statutory regulations, noting that technical violations did not absolve individuals from liability. Referring to Supreme Court decisions, the Tribunal held that penalties were applicable upon contravention of statutory obligations, irrespective of intent. The appellant's argument of good faith was dismissed, and the penalty was upheld, considering the seriousness of regulatory contraventions.5. Ultimately, the Tribunal partially allowed the appeal, considering the appellant's circumstances as a housewife who utilized the received amount for legitimate purposes. The penalty was reduced to the amount already adjusted from the blocked sum, taking into account the lengthy pendency of the case and the appellant's suffering. The pre-deposited amount was to be appropriated towards the reduced penalty, ensuring justice in the matter.