Ambiguous and contradictory evidence cannot sustain a FERA penalty where the alleged contravener is not clearly identified.

Penalty under the Foreign Exchange Regulation Act was found unsustainable because the material did not clearly identify the alleged contravener and the evidence remained ambiguous and contradictory. The adjudicating authority had relied on a retracted statement and another person's statement, but the appellant's statement was not treated as a reliable self-incriminatory admission, and no independent witness from the panchnama was examined. On that record, culpability was not established with the required certainty, so the impugned penalty order was set aside in favour of the appellant.

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Issues: Whether the penalty imposed under section 9(1)(b) of the Foreign Exchange Regulation Act, 1973 was sustainable on the basis of the material and statements relied upon by the adjudicating authority.

Analysis: The material relied upon did not establish a clear and definite identity of the alleged contravener, as the record referred ambiguously to either Garg or Ramesh. The appellant's statement was not treated as a self-incriminatory admission, and the reliance placed on a retracted statement and the statement of another person was found insufficient, especially when the versions were contradictory and no independent witness from the panchnama was examined. In these circumstances, guilt could not be fastened with the required certainty.

Conclusion: The penalty was not sustainable and the impugned order was liable to be set aside in favour of the appellant.

Ratio Decidendi: A penalty under the Foreign Exchange Regulation Act cannot be sustained where the evidence is ambiguous, contradictory, and insufficient to establish culpability with clear identification of the alleged contravener.

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