1996 (2) TMI 604 - AT - FEMA

Appeal Success: Tribunal Sets Aside Order, Orders Refund of Penalties & Return of Confiscated Rs. 10,000 in 45 Days.

D.F. Abubaker Versus Director of Enforcement

The appeals were allowed, and the impugned order was set aside due to the lack of a personal hearing and the superseding nature of subsequent adjudication ... - Issues:- Imposition of penalties under the Foreign Exchange Regulation Act, 1973 for contravention of specific sections.- Lack of personal hearing before passing the impugned order.- Withdrawal of subsequent adjudication orders and its impact on the impugned order.- Request for waiver of pre-deposit and refund of deposited amounts.Analysis:The judgment involves appeals arising from a common adjudication order imposing penalties on three appellants for contraventions of sections 9(1)(b), 9(1)(d), and 19(1)(b) of the Foreign Exchange Regulation Act, 1973. The penalties ranged from Rs. 50,000 to Rs. 60,000, with an additional confiscation of Rs. 10,000 seized from one appellant's business premises. The first appellant did not appear, citing involvement in a criminal matter, while the second and third appellants were represented by Shri Mahendra Singh. The issue of lack of personal hearing before passing the impugned order was raised, emphasizing that the appellants were not afforded a personal hearing despite requests, leading to the challenge of the order on procedural grounds.Shri Mahendra Singh argued that subsequent adjudication orders dated 16-8-1994, which were withdrawn by the Adjudicating Officer, rendered the original impugned order non-existent for the three appellants. He contended that the impugned order should be set aside due to the withdrawal of these subsequent orders and the lack of legal effect. Additionally, he requested a waiver of the pre-deposit requirement, highlighting that two appellants had already partially deposited penalty amounts, which would cause undue hardship if required to be fully deposited.Upon review of the adjudication file, it was established that the impugned order was indeed passed without affording the appellants a personal hearing, contrary to their requests. The Adjudicating Officer subsequently granted a personal hearing and passed fresh adjudication orders after considering written submissions. Consequently, the impugned order was deemed legally unsustainable on the grounds of lack of personal hearing and the subsequent adjudication orders superseding it. As a result, all three appeals were allowed, setting aside the impugned order against the appellants.Regarding the pre-deposit amounts, it was ordered that any amounts deposited by the appellants should be refunded within 45 days of the order. Additionally, the confiscated amount of Rs. 10,000 was to be refunded to the appellant from whom it was seized, concluding the judgment comprehensively.