TaxTMI 
TaxTMI 
2014 (2) TMI 783
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....adjudication orders ('AOs') passed by the Special Director ('SD'), Enforcement Directorate ('ED') holding the Appellants to have contravened Section 8 (1) of the Foreign Exchange Regulation Act, 1973 ('FERA') and imposing a penalty of different amounts under Section 50 of FERA on them. 2. The common issue in all these cases is whether the expatriated employees seconded by the parent corporation to its branch or liaison office in India are required to be paid salaries by such liaison or branch office and further whether the payment made by the parent corporation to its expatriated employees abroad creates any liability on the liaison or branch office to repay the said amount to the parent corporation. 3. The above question, which arises in....
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....payment of salaries abroad by such parent corporation to the expatriated employees. It was nevertheless held that there was a violation of Section 8 (1) FERA by each Appellant. Accordingly, a penalty under Section 50 FERA was levied on each Appellant. The AT has upheld the said AOs and dismissed the appeals filed by the Appellants. 7. On the question whether there was any violation of Section 8 (1) FERA, the Appellants have contended that the judgment of this Court in Mitsubishi Corporation covers the present appeals on all fours. When Mitsubishi Corporation was argued before this Court, the Respondent had submitted a written note of argument. Mr. Ashok Kumar Panda, learned Senior counsel appearing on behalf of the Respondent in all these ....
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....n, seconded to the Appellant, are its "borrowed employees". The fact of the matter is that the expatriated employees of the HO, are posted in India with the LO, continue to be employees of the parent corporation. The salaries payable to them by the parent corporation were partly paid in India, and for that limited purpose, the funds were remitted by Mitsubishi, Japan which were then disbursed by the Appellant to such seconded employees. By no means, could it be said that the expatriated employees upon being seconded to the Appellant ceased to be the employees of the parent corporation. They were only seconded to the Appellant. They could not be termed as "borrowed employees" of the Appellant. The liability to pay their salaries continues to....