Bona fide efforts to realise export proceeds can negate contravention where persistent recovery steps are documented.

Reasonable and sincere efforts to realise export proceeds can defeat a charge of contravention under section 18(2) of the Foreign Exchange Regulation Act, 1973. The tribunal found that the appellant had produced correspondence, telephone records, personal visits to the foreign buyer, and banker-related steps seeking extension of time, together with later recovery efforts after the buyer's financial failure and bankruptcy. These materials showed bona fide and persistent attempts to recover the dues, not inaction or indifference. On that evidence, the allegation that no serious effort had been made was unsupported, so the contravention was not made out and the penalty could not stand.

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Issues: Whether the appellant had taken reasonable and sincere steps to realise the export proceeds so as to avoid contravention under section 18(2) of the Foreign Exchange Regulation Act, 1973.

Analysis: The appellant produced correspondence, telephone records, visits made to the foreign buyer, and material showing attempts to recover the outstanding export proceeds, including efforts to obtain extension of time through the banker and subsequent recovery to the extent possible after the buyer's financial failure and bankruptcy. On the record, the evidence supported bona fide and persistent efforts to realise the dues rather than inaction or indifference. The finding that there had been no serious effort was therefore not supported by the material placed before the authority.

Conclusion: The contravention under section 18(2) was not made out and the penalty could not stand; the appeal succeeded.

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