Abetment penalty under FERA falls when the underlying contravention order against the main noticee is set aside.

A penalty for abetment under FERA could not survive once the principal contravention order against the main noticee had already been set aside for lack of substantiating evidence. The appellate board held that the appellant's liability as an abettor depended on the existence of a sustainable underlying contravention under sections 8(3) and 8(4), read with section 64(2), of the Foreign Exchange Regulation Act, 1973. With the foundation of the main charge removed, the basis for penal action against the appellant ceased to exist. The penalty was therefore unsustainable and was set aside.

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Issues: Whether the penalty imposed for abetment of contravention under the Foreign Exchange Regulation Act, 1973 could survive after the principal contravention order against the main noticee had already been set aside.

Analysis: The penalty arose from an alleged abetment of contravention of section 8(3), read with section 8(4), of the Foreign Exchange Regulation Act, 1973, and section 64(2) was invoked for the penal action. The basis of the impugned finding against the appellant depended on the sustainability of the main contravention attributed to the principal party. Since the Board had already set aside the order against the principal noticee on the ground that the evidence did not substantiate the charge, the foundation for treating the appellant as an abettor ceased to exist. On that footing, the penalty on the appellant could not stand.

Conclusion: The penalty for abetment was unsustainable and was set aside in favour of the appellant.

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