Export proceeds blocked by foreign embargo cannot sustain penalty where non-remittance is beyond the exporter's control.

Export proceeds that remained unrealised because a foreign buyer had already deposited payment with its bank, but remittance was blocked by a foreign government embargo, did not justify penalty against the exporter. The decisive point was that the non-realisation was caused by circumstances beyond the exporter's control and was not attributable to any default on its part. On that basis, liability for alleged contravention could not be sustained and the adjudication order was set aside.

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Issues: Whether the appellants could be held liable for contravention and penalty for non-realisation of export proceeds when the foreign buyer had deposited the amount with its bank but remittance was prevented by an embargo imposed by the foreign government.

Analysis: The export proceeds had not been received, but the material facts showed that the foreign buyer had already deposited the amount with its bank for remittance to the appellants. The failure to remit was caused by the embargo imposed by the Yemen Government, a circumstance beyond the appellants' control. The adjudicating authority had proceeded on the absence of further RBI extension, but the decisive fact was that the non-realisation was not attributable to any default on the part of the appellants.

Conclusion: The appellants were not liable for the alleged contravention, and the penalty could not be sustained.

Final Conclusion: The adjudication order was set aside and the appellants were exonerated from liability for the alleged non-realisation of export proceeds.

Ratio Decidendi: Where export proceeds remain unrealised solely because remittance is blocked by a foreign governmental embargo after payment has been made to the buyer's bank, the exporter cannot be treated as in breach for non-realisation beyond its control.

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