FERA contraventions and procedural fairness upheld where corroboration supported statements and no prejudice arose from denied cross-examination.

FERA adjudication under challenge was upheld where the authority was validly empowered by notification, the show-cause notice was supported by annexures, and delay was not treated as fatal because the investigation involved extensive records. Disclosure of relied-upon documents and an opportunity to respond meant that absence of cross-examination did not vitiate the proceedings without shown prejudice. On the substantive contravention issues, liability under Sections 8(3), 8(4), 9(1)(b) and 64(2) was treated as extending to a person controlling the firms and remittances, not only the formal importer. Corroborated statements, bank records, customs material, and other independent evidence were sufficient to sustain the findings.

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Issues: (i) Whether the adjudicating authority was competent and whether the proceedings were vitiated by delay, vagueness of notice, or denial of cross-examination. (ii) Whether the contraventions under Sections 8(3), 8(4), 9(1)(b) and 64(2) of the Foreign Exchange Regulation Act, 1973 were established against the appellants.

Issue (i): Whether the adjudicating authority was competent and whether the proceedings were vitiated by delay, vagueness of notice, or denial of cross-examination.

Analysis: The authority was held to be duly empowered under the Central Government notification issued in exercise of powers under Section 5 of the Foreign Exchange Regulation Act, 1973. The notice was supported by detailed annexures and the investigation required collation of a large body of statements and records, so the delay in issuing the show cause notice was not treated as fatal. As the relied-upon documents were supplied and the appellants had an opportunity to respond, denial of cross-examination was found not to have caused prejudice.

Conclusion: The objections to competence, delay, vagueness, and denial of cross-examination were rejected.

Issue (ii): Whether the contraventions under Sections 8(3), 8(4), 9(1)(b) and 64(2) of the Foreign Exchange Regulation Act, 1973 were established against the appellants.

Analysis: The provisions were read as applying to a "person" and not only to the named importer, and the evidence showed that Shri R.K. Verma controlled the firms and the remittances. The statements of the noticees were found to be corroborated by bank records, customs material, and other independent evidence. The retracted statements of Shri R.A. Soni were treated as usable because they were supported by corroboration, and the evidence established his role in facilitating the remittances. The absence of proof of actual imports against the remittances further supported the finding of contravention.

Conclusion: The contraventions were proved against both appellants.

Final Conclusion: The appeals failed on merits, and the penalties and findings of contravention were sustained.

Ratio Decidendi: For contraventions under FERA provisions framed in terms of a "person", liability is not confined to the formal importer, and retracted statements may be relied upon when materially corroborated by independent evidence; where relied-upon documents are disclosed, denial of cross-examination does not vitiate the adjudication absent demonstrated prejudice.

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