Premature adjudication for non-realisation of export proceeds cannot stand while RBI write-off applications remain pending.

Where write-off applications concerning outstanding export proceeds were still pending before the RBI, adjudication for non-realisation of those proceeds was premature and the penalty could not be sustained at that stage. The impugned order was set aside, with liberty to initiate fresh proceedings after the RBI decides the applications.

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Issues: Whether the adjudication proceedings and the penalty imposed for non-receipt of export proceeds were premature when the appellant's applications for write-off were pending consideration before the Reserve Bank of India.

Analysis: The pending applications for write-off of the outstanding export proceeds showed that the regulatory process before the Reserve Bank of India had not concluded. In that situation, the adjudication proceedings were held to be premature, and the penalty could not be sustained at that stage. The order was therefore liable to be set aside, while leaving it open to the authorities to commence fresh proceedings after the Reserve Bank of India decided the applications.

Conclusion: The issue was decided in favour of the appellant. The penalty order was set aside as premature, with liberty to initiate fresh proceedings after the Reserve Bank of India takes a decision.

Final Conclusion: The appeals succeeded because the impugned adjudication was held to be premature in view of the pending write-off applications before the Reserve Bank of India.

Ratio Decidendi: Where an application for write-off or extension of time in relation to export proceeds is pending before the Reserve Bank of India, adjudication for non-realisation of those proceeds is premature and cannot be sustained until that regulatory decision is taken.

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