Foreign exchange contraventions upheld, but penalties reduced after Board found the conduct non-prejudicial and excessive.

Contraventions under sections 9(1)(a), 9(1)(b) and 9(1)(d) of the Foreign Exchange Regulation Act, 1973 were established on the admitted facts, but the Board found the conduct was not prejudicial to the objects and purposes of the Act. In those circumstances, the penalty imposed by the adjudicating authority was treated as excessive and was moderated. The findings of contravention were upheld, while the penalties were reduced to Rs. 5,000 in one appeal and Rs. 10,000 in the other, with consequential reduction of the amount payable by the second appellant.

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Issues: Whether the contraventions under section 9(1)(a), section 9(1)(b) and section 9(1)(d) of the Foreign Exchange Regulation Act, 1973 were established and, if so, whether the penalties deserved reduction.

Analysis: The admitted facts showed that the appellants' acts fell within the statutory prohibition. At the same time, the conduct was found not to have been prejudicial to the objects and purposes of the Act. On the surrounding circumstances, the Board accepted that the matter warranted moderation in the quantum of penalty, and that the penalty imposed by the adjudicating authority was excessive in the facts of the case.

Conclusion: The findings of contravention were upheld, but the penalties were reduced to Rs. 5,000 in one appeal and to Rs. 10,000 in the other appeal, with consequential reduction of the amount payable by the second appellant.

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