TaxTMI 
TaxTMI 
1980 (10) TMI 156
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....00 were seized from the appellant by the Railway Police at the Railway Station at Sangrur. Thereupon proceedings were initiated against the appellant for contravention of sections 4 and 9 of the Act under section 23(1)(a) read with section 23D of the Act before the Director of Enforcement of Foreign Exchange Regulation, appointed by the Central Govt. for the purpose of enforcing the provisions of the Act. By an ex parte order dated May 12, 1967, the Director of Enforcement held the appellant guilty of contravention of provisions of section 9 of the Act read with the Central Govt. notification No. F. 1(67)-EC/57 dated September 25, 1968 as amended up to March 6, 1961, and section 4(1) of the Act and imposed on him a penalty of Rs. 6,000 which the appellant was directed to pay to the Directorate of Enforcement within forty-five days of the issue of the order. As the penalty was not paid within forty-five days from the date of the issue of the order of the Director of Enforcement, a complaint was lodged on November 13, 1969, by the Deputy Director of Enforcement before the Judicial Magistrate, First Class, New Delhi, under section 23F of the Act. In the complaint it was specifically s....
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.... to assist the court in the appeal. After hearing the learned counsel who appeared in the case, the High Court by its judgment dated November 9, 1973, reversed the order of acquittal passed by the Magistrate, found the appellant guilty of the offence punishable under section 23F of the Act and sentenced him to imprisonment for a term of one year. While doing so, the High Court agreed with the finding of the Magistrate that the order of the Director of Enforcement, imposing penalty on the appellant, had not been served on the appellant on May 4, 1968, as alleged in the complaint, but it was of the view that since the appellant had come to know about the order on August 7, 1970, when he appeared before the Magistrate and he had not paid the penalty within a reasonable time thereafter, he was liable to be punished under section 23F of the Act. The relevant part of the judgment of the High Court reads thus : " The order of acquittal made by the learned trial Magistrate proceeds, in our opinion, on an altogether erroneous view of the provisions of section 23F of the Act. For proving the guilt of Dara Singh in the light of the charge framed against him, it had only to be established t....
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....ing the inquiry under section 23D of the Act. Rule 3 of the Rules among others provides for the issue of a notice to the person against whom proceedings are initiated for contravention of the provisions referred to in section 23(1) of the Act and for giving an opportunity to him to defend himself in the proceedings before the Director of Enforcement. Sub-rule (7) of rule 3 of the Rules provides that if, upon consideration of the evidence produced before the Director, the Director is satisfied that the person has committed the contravention, he may, by order in writing impose such penalty as he thinks fit in accordance with the provisions of clause (a) of sub-section (1) of section 23. There is no rule requiring the person against whom an order is made to appear before the Director of Enforcement on any specified date on which the order would be pronounced in his presence. Rule 4 of the Rules requires the Director of Enforcement to specify in his order the provisions of the Act or of the Rules, directions or orders made thereunder in respect of which contravention has taken place and to give brief reasons for his decision. Rule 5 of the Rules requires that a copy of the order made u....
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....f penalty. When the law lays down that non-compliance with an order would expose the person, against whom it is made, to criminal liability, it is reasonable to hold that in the absence of proof of his knowledge of the order no penal action can be taken against him for non-compliance with it. The information or knowledge which he may gather about such order in the course of the criminal proceedings instituted for non-compliance with it cannot be a substitute for the knowledge of the order as mentioned above, which should ordinarily precede the institution of such proceedings. Under section 23F of the Act if any person fails to pay the penalty imposed by the Director of Enforcement, he on conviction is liable to be punished with imprisonment which may extend to two years or with fine or with both. No person can be convicted under section 23F for failure to pay the penalty imposed on him by the Director of Enforcement when he is not at all informed earlier about the imposition of the penalty. Hence in the absence of proof of his knowledge of the order either by the supply of the copy of the order under rule 5 of the Rules or in any other manner, it cannot be said that such person ....