Reasonable steps to realise export proceeds failed to rebut the statutory presumption of contravention under foreign exchange law.

Under the Foreign Exchange Regulation Act, 1973, an exporter seeking to rebut the statutory presumption of contravention for non-realisation of export proceeds had to show sincere and reasonable steps to recover the dues. The Court noted that the exporter did not produce liquidation documents of the foreign buyer, did not obtain the required confirmation from the Indian High Commission, and did not seek extension of time from the Reserve Bank of India. The correspondence also indicated settlement directly with the overseas buyer without RBI permission. On these facts, the presumption was not rebutted, and the finding of contravention with the reduced penalty was upheld.

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Issues: Whether the exporter had taken all reasonable steps to realise the outstanding export proceeds so as to rebut the statutory presumption of contravention and avoid penalty under the Foreign Exchange Regulation Act, 1973.

Analysis: The Court accepted the findings of the appellate authority that the exporter had not produced liquidation documents of the foreign buyer, had not obtained the required confirmation from the Indian High Commission, and had not sought extension of time from the Reserve Bank of India. The correspondence relied upon also showed that the matter had been settled directly with the overseas buyer, without permission of the Reserve Bank of India. On these facts, the exporter failed to show the sincere and reasonable efforts required to rebut the presumption arising under Section 18(3) of the Foreign Exchange Regulation Act, 1973.

Conclusion: The finding of contravention and the reduced penalty were upheld against the appellant.

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