Rebuttable presumption in export proceeds realisation remained unrebutted; contravention finding and penalty were upheld.

Section 18(3) of the Foreign Exchange Regulation Act created a rebuttable presumption against the exporter once the prescribed period for realisation expired without payment. The appellants failed to rebut that presumption because the record did not show timely and effective steps to recover the export proceeds; the correspondence relied on largely concerned other entities, the U.S. Bankruptcy Court claim was filed only after expiry of the relevant period, and no adequate approach to the Indian Embassy or the Reserve Bank was shown within time. On those facts, the finding of contravention of section 18(2) was sustained, and the penalty was upheld as proportionate.

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Issues: Whether the appellants had rebutted the statutory presumption under section 18(3) of the Foreign Exchange Regulation Act, 1973 by showing that they had taken all reasonable steps to realise and repatriate the export proceeds, and whether the penalty imposed for contravention of section 18(2) was liable to be interfered with.

Analysis: Section 18(3) creates a rebuttable presumption against the exporter once the prescribed period for realisation has expired without payment being received. The material on record did not show that the appellants took timely and effective steps within the prescribed period to recover the export proceeds. The correspondence relied upon was found to relate largely to other entities, and the claim before the U.S. Bankruptcy Court was lodged only after the expiry of the relevant period. The appellants also failed to show any adequate approach to the Indian Embassy or the Reserve Bank within time. On these facts, the adverse presumption remained unrebutted, and the adjudication order could not be faulted. The penalty was also held to be proportionate to the amount involved.

Conclusion: The appellants failed to displace the presumption of contravention under section 18(3), and the finding of violation under section 18(2) together with the penalty was upheld.

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