2014 (2) TMI 1441 - AT - FEMA

Deputy Director must retry FERA sections 8(3) and 8(4) violations for failure to import goods after foreign exchange remittance

The Foreign Exchange Regulation Appellate Board remanded the case to the Deputy Director for trial regarding violations of FERA sections 8(3) and 8(4) ... Violation of provisions of section 8(3) read with section 8(4) of FERA - Failure to import goods after remitting foreign exchange abroad - whether the two remittances as mentioned in the first SCN have also been included in the second SCN making the second SCN consolidated one to cover all the remittances - HELD THAT:- The expression 'shall not be bound by the Procedure laid by the Code of Civil Procedural 1908 (5 of 1908), but shall be guided by the principles of natural justice' used in the afore quoted sub-section (1) of section 28 of FEMA does not debar this Tribunal to follow provisions of Code of Civil Procedure to the extent the provisions are in consonance with the principles of natural justice. As such this Tribunal refers the issue so framed to the Ld. Deputy Director who has made impugned order for trial. The Ld. Deputy Director may take the additional evidence, if necessary for determining the issue framed by this Tribunal. After trial of the issue and recording the evidences which soever are necessary, the Ld. Deputy Director shall return the same to this Tribunal with his findings and reasons thereon preferably within three months from the date on which the parties in this appeal first appear before him and the parties in the instant appeal are directed to appear before the Ld. Deputy Director for such purpose on the date fixed by him within 15 days from the receipt of this order. 1. ISSUES PRESENTED and CONSIDEREDThe judgment primarily revolves around the following legal issues:Whether the appellant company, M/s World Resort Ltd., contravened Sections 8(3) and 8(4) of the Foreign Exchange Regulation Act, 1973 (FERA) by failing to import goods after remitting foreign exchange abroad. Whether the penalty imposed on the appellant for the alleged contravention constitutes double jeopardy, considering previous adjudication on similar remittances. Whether the two remittances mentioned in the first Show Cause Notice (SCN) are included in the second SCN, thus making the second SCN a consolidated one covering all remittances. Whether the Appellate Tribunal has the power to remand the matter back to the Deputy Director for further examination of the issues.2. ISSUE-WISE DETAILED ANALYSISIssue 1: Alleged Contravention of FERARelevant Legal Framework and Precedents: The case involves the contravention of Sections 8(3) and 8(4) of FERA, which deal with the regulation of foreign exchange transactions and the requirement to submit evidence of import of goods for which foreign exchange was remitted. Court's Interpretation and Reasoning: The court examined whether the appellant failed to comply with the provisions by not importing goods after remitting foreign exchange. Key Evidence and Findings: The appellant argued that the remittances were part of a consolidated SCN, which had already been adjudicated, thus questioning the validity of the penalty imposed under the impugned order. Application of Law to Facts: The court considered the evidence submitted by the appellant, including correspondence and previous adjudication orders, to determine the legitimacy of the penalty. Treatment of Competing Arguments: The appellant's counsel argued against the imposition of a penalty, citing double jeopardy, while the respondent's counsel maintained the validity of the penalty. Conclusions: The court found that the issue of whether the remittances in the first and second SCNs were the same was not adequately addressed in the impugned order.Issue 2: Double Jeopardy and Consolidation of SCNsRelevant Legal Framework and Precedents: The principle of double jeopardy prevents a party from being tried or penalized twice for the same offense. Court's Interpretation and Reasoning: The court noted the potential overlap between the two SCNs and the need to determine if the penalties imposed constituted double jeopardy. Key Evidence and Findings: The court highlighted discrepancies in the amounts and dates mentioned in the SCNs, suggesting the possibility of overlap. Application of Law to Facts: The court considered whether the penalties for the remittances were already covered under a previous adjudication order. Treatment of Competing Arguments: The appellant argued that the penalties were duplicative, while the respondent did not provide clarity on the distinction between the SCNs. Conclusions: The court decided to remand the matter to the Deputy Director for further examination of whether the remittances in the SCNs were indeed the same.Issue 3: Power to RemandRelevant Legal Framework and Precedents: The court referred to the inherent powers of appellate authorities to remand cases for further examination, as established in previous judgments. Court's Interpretation and Reasoning: The court emphasized the necessity of remanding the case to ensure a just decision, given the lack of clarity on the overlap of remittances. Key Evidence and Findings: The court cited previous judgments supporting the power to remand when necessary for a comprehensive examination of facts. Application of Law to Facts: The court applied the principle of remand to address the unresolved issue of potential overlap between the SCNs. Treatment of Competing Arguments: The court balanced the need for a thorough examination against the potential for procedural delays. Conclusions: The court remanded the case to the Deputy Director to determine whether the two remittances were included in both SCNs.3. SIGNIFICANT HOLDINGSPreserve Verbatim Quotes of Crucial Legal Reasoning: 'In my considered view every Appellate Authority exercising judicial or quasi-judicial powers vests with the inherent powers to remand a matter.' Core Principles Established: The judgment reinforced the principle that appellate authorities have the power to remand cases for further examination to ensure justice and prevent double jeopardy. Final Determinations on Each Issue: The court remanded the case to the Deputy Director to determine if the remittances in the SCNs were the same, thereby addressing the issue of double jeopardy and ensuring a fair adjudication process.The judgment underscores the importance of clarity and thorough examination in adjudication processes, particularly when multiple proceedings may overlap, potentially leading to double penalties for the same offense.