Acknowledgement of debt requires a clear act; intent to reciprocate a gift was insufficient under foreign exchange law.

Liability under section 9(1)(c) of the Foreign Exchange Regulation Act, 1973 required a clear acknowledgement of an existing debt. The tribunal found no overt act by the appellant showing such acknowledgement, and held that a mere stated intention to reciprocate gifts from a relative did not establish a debt or its admission. The appellant's declaration of the gift items to customs and payment of duty were treated as consistent with the absence of any dishonest or unlawful design. On that footing, the contravention charge was not made out, the penalty order was set aside, and the deposited amount was directed to be refunded.

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Issues: Whether the appellant's statement and conduct constituted an acknowledgement of debt attracting section 9(1)(c) of the Foreign Exchange Regulation Act, 1973.

Analysis: Liability under section 9(1)(c) required a clear acknowledgement of debt. The record did not show any overt act by the appellant amounting to such acknowledgement. A mere expression of an inclination to reciprocate gifts given by a relative was insufficient to establish a debt or its acknowledgement. The appellant's declaration of the gift items to customs and payment of duty also supported the absence of any dishonest or unlawful design.

Conclusion: The charge of contravention under section 9(1)(c) was not made out.

Final Conclusion: The penalty order was set aside and the amount deposited was directed to be refunded.

Ratio Decidendi: An expression of intention to reciprocate a gift does not amount to acknowledgement of debt unless there is a clear debt and a definite act acknowledging it.

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