2004 (10) TMI 645 - AT - FEMA

Tribunal Overturns Order Due to Lack of Evidence, Orders Refund Within 15 Days, Stresses Need for Solid Proof.

The Tribunal quashed the adjudication order for contravention of the Foreign Exchange Regulation Act due to insufficient evidence. It found no concrete ... - Issues:1. Challenge to adjudication order for contravention of Foreign Exchange Regulation Act.2. Lack of evidence in passing the impugned order.3. Interpretation of acknowledgment of debt in favor of a foreign resident.4. Application of legal principles regarding circumstantial evidence.5. Decision on the appeal and refund of the pre-deposit amount.Analysis:1. The appellant challenged an adjudication order imposing a penalty for contravention of the Foreign Exchange Regulation Act. The appellant acknowledged receiving a cheque from a foreign resident and was accused of acknowledging a debt in favor of the donor. The appeal was heard on merits for final disposal.2. The appellant's counsel argued that the impugned order lacked substantial evidence and was based on imagination and surmises. It was contended that the mere receipt of a cheque does not necessarily imply acknowledgment of debt. The counsel cited judgments to support the argument that suspicion alone cannot lead to an adverse decision without concrete evidence.3. The respondent argued that the payment was not a gift but a clandestine payment that required acknowledgment of repayment. It was emphasized that human conduct should be considered, and there must be a commitment to repay or acknowledge debt in such circumstances. The appellant's plea that the gift was a donation to an institution was dismissed as insufficient to support the impugned order.4. The Tribunal noted that there was no verbal or documentary evidence against the appellant regarding the acknowledgment of debt. It was highlighted that suspicion, without concrete proof, cannot justify an adverse decision. The Tribunal referenced a Supreme Court judgment emphasizing the need for a complete chain of circumstances in circumstantial evidence cases.5. The Tribunal quashed the impugned order, stating that it lacked evidence against the appellant. The appeal was allowed, and the pre-deposit amount was ordered to be returned to the appellant within 15 days. The decision was based on the contents of the impugned order and the facts presented therein, without the need for further discussion of cited cases.