Repatriation of export proceeds: failure to rebut presumption of inadequate steps upheld penalty under foreign exchange law.

The exporter was required to realise the full export value within the prescribed period under Rule 8 of the Foreign Exchange Regulation Rules, 1974, and a failure to receive payment within that period raised a rebuttable presumption under section 18(3) of the Foreign Exchange Regulation Act, 1973, that reasonable steps to secure repatriation had not been taken. The Tribunal found that the appellant did not displace that presumption, as the later bankruptcy of the foreign buyer and a pending write-off request did not show reasonable efforts during the relevant period. The penalty order was therefore upheld for contravention of section 18(2).

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Issues: Whether the appellant failed to take reasonable steps to secure repatriation of export proceeds and thereby contravened section 18(2) of the Foreign Exchange Regulation Act, 1973, read with the presumption under section 18(3) of that Act.

Analysis: The statutory scheme required the exporter to realise the full export value within the prescribed period under Rule 8 of the Foreign Exchange Regulation Rules, 1974, and failure to receive payment within that period raised a rebuttable presumption that reasonable steps had not been taken. The Tribunal found that the appellant did not displace that presumption. The plea based on a belated bankruptcy of the foreign buyer and a pending write-off request did not establish that reasonable efforts had been made in the relevant period.

Conclusion: The appellant was held to have failed to take reasonable steps for repatriation of the export proceeds, and the penalty order was upheld.

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