Mandatory pre-deposit, outer limitation bar, and unrebutted import presumption sustained enforcement under foreign exchange law.

The Foreign Exchange Regulation Act appeal scheme made pre-deposit of the penalty a mandatory filing condition, save for limited dispensation on undue hardship, so non-compliance rendered the affected appeals not maintainable. The special limitation regime required filing within forty-five days, with a maximum extension up to ninety days, and appeals filed beyond that outer limit were barred. On the merits, the statutory presumption against unexplained foreign exchange remittances for import purposes was not rebutted; the bill of entry and affidavit were treated as insufficient, and the RBI write-off did not undo the enforcement breach. The penalty findings were therefore sustained.

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Issues: (i) Whether the appeals were maintainable in the absence of compliance with the pre-deposit requirement under Section 52(2) of the Foreign Exchange Regulation Act, 1973. (ii) Whether the appeals filed beyond the statutory period were barred by limitation. (iii) Whether the appellants had rebutted the statutory presumption and proved import of goods against the foreign exchange remittances, and whether the RBI write-off affected the enforcement action.

Issue (i): Whether the appeals were maintainable in the absence of compliance with the pre-deposit requirement under Section 52(2) of the Foreign Exchange Regulation Act, 1973.

Analysis: The statutory scheme made deposit of the penalty amount a condition for filing an appeal, subject only to a discretionary dispensation on the ground of undue hardship. The appeals in question had been granted partial dispensation, but the required deposits were not made in respect of some appeals. The provision was treated as mandatory and incapable of being diluted by judicial sympathy or by reading into it a relaxation not found in the text.

Conclusion: The appeals were not maintainable to the extent there was non-compliance with the pre-deposit condition, and that failure operated against the appellants.

Issue (ii): Whether the appeals filed beyond the statutory period were barred by limitation.

Analysis: The appeal provision allowed filing within forty-five days, with a further limited extension on showing sufficient cause, but not beyond ninety days. The Tribunal held that the special limitation scheme excluded the general provisions of the Limitation Act to that extent. On the facts, some appeals were filed beyond ninety days from service of the order and could not be entertained.

Conclusion: The delayed appeals were barred by limitation and liable to fail against the appellants.

Issue (iii): Whether the appellants had rebutted the statutory presumption and proved import of goods against the foreign exchange remittances, and whether the RBI write-off affected the enforcement action.

Analysis: Under the foreign exchange restrictions, where remittance was made for import purposes and the goods were not brought in or adequately proved, an adverse presumption arose and the burden lay on the importer to show actual import. The documents produced, including the bill of entry and affidavit, were treated as insufficient by themselves. The RBI communication granting write-off was held not to displace the enforcement proceedings or neutralise the statutory breach.

Conclusion: The appellants failed to prove import and failed to displace the statutory presumption, so the penalty findings were sustained.

Final Conclusion: The statutory appeal rights were defeated by a combination of non-compliance with the deposit condition, delay beyond the outer limitation period, and failure to establish lawful use of the foreign exchange remittances.

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