TaxTMI 
TaxTMI 
2008 (11) TMI 53
X X X X Extracts X X X X
X X X X Extracts X X X X
....Section 51 of the Foreign Exchange Regulation Act, 1973 ("FERA") for violation of Section 8(1) thereof. The case of the Respondent against Appellant Shri Nemi Chand Jain @ Shri Chandraswamy and Appellant Shri Vikram Singh was that a sum of US $ 1,49,000 had been withdrawn by them from the non-resident external (NRE) account in Canara Bank R.K.Puram, New Delhi of one Shri Akbar Jaffar Ali Veerjee ("Veerjee") a resident of Leichtenstein who stayed in India between 1^st and 3^rd July 1992. Veerjee had initially deposited a sum of US $ 500 (equivalent to Rs.14,850) at the time of opening the account. Thereafter on 4^th July 1992 a sum of US $ 10,000 (equivalent to Rs.2,95,000) came deposited in the account followed by US $ 1,39,000 (equivalent to Rs.42,29,756) by Foreign Inward Telegraphic Transfer (FITT) from the Swiss Bank Corporation (Jersey) Ltd. The case of the Respondent was that it was revealed during investigation that from Veerjee's NRE account the following persons withdrew various sums through cheques in their favour: Shri Prakash Chandra Yadav withdrew Rs.30 lakhs on 17^th July 1992, Appellant Shri Vikram Singh Rs.5 lakhs on 18^th July 1992 and Vishwa Dharmayatan (which ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....osit in the account was received by the bank in the form of an Foreign Inward Telegraphic Transfer, which along with the earlier deposits in cash works out to a total deposit of US $ 1,49,500/- into the account during a short span of period from 1^st July to 17^th July, 1992 and a major part of its equivalent amount in Indian Rupees to the extent of Rs.45,00,000/- was shared by S/Sh. Prakash Yadav, Vikram Singh and Chandraswamy (through his Ashram). The balance amount of Rs.43,251/- including interest but excluding bank charges, taken over by the department, is also a part of the above foreign exchange." 5. In conclusion the following order was passed by the Deputy Director: "I hold S/Shri Chandraswamy (Shri Nemi Chand Jain) and Vikram Singh, noticee no.1 and 2, respectively, guilty of contravention of Section 8 (1) of FERA, 1973 to the tune of US $ 1,49,000/-, for its otherwise acquisition from the persons other than the authorized dealer, without special or general permission from the Reserve Bank of India and impose a penalty of Rs.10,00,000/- (Rupees Ten Lacs only) upon Shri Chandraswamy (Shri Nemi Chand Jain) and impose a penalty of Rs.10,00,000/- (Rupees Ten Lacs only) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed by the Respondent that Chandraswami is solely managing the affairs of Vishwadharma Trust, hence all the benefits of Trust flow to this appellant. The appellant, Vikram Singh in whose favour a gift of Rs.5,00,000/- has been made has also not been able to prove his financial difficulty. Looking towards the situation, we direct both appellants to pre-deposit full amount of penalty within 45 days from today failing which the appeal will be dismissed on this ground alone." 7. The Appellants then filed W.P. (c) No. 5613 of 2006 and W.P. (c) No. 5618 of 2006 in this Court challenging the aforementioned order of the Tribunal. By separate but identical orders dated 24^th April 2006 the learned Single Judge has dismissed the writ petitions for the following reasons: "In order to be eligible for exemption from pre-deposit of the penalty, the petitioner must succeed before the Tribunal in establishing a strong prima facie case. In this context, the Tribunal has come to the conclusion that the petitioners are linked with the transaction and have benefited to the extent indicated in the impugned order. Having heard to the learned Counsel for the petitioner, I am satisfied....
X X X X Extracts X X X X
X X X X Extracts X X X X
....atus since then, the same order ought to have been passed in the present case as well. Mr.Lekhi added that as a sanyasi Shri Chandraswamy had already suffered a "civil death" and had no resources whatsoever to be able to make the pre-deposit as ordered by the Tribunal. 10. Mr.Vali for the Respondent drew our attention to the specific findings in the adjudication order of the Deputy Director and submitted that no prima facie case from grant of any exemption had been made out. He referred to the decision of the Supreme Court in Monotosh Saha v. Special Director, Enforcement Directorate 2008 (11) SCALE 603 and an order dated 22^nd July 2005 in S.L.P. (c) No. 12728 of 2005 (Rajiv Narendra Khanna v. Union of India) and submitted that no case of genuine financial hardship had been made out by either appellant. 11. Having considered the submissions and examined the records, we are not persuaded to take a view different from the concurrent orders of the Tribunal and the learned Single Judge. At the present stage, a detailed examination of the case on merits is not warranted. What has to be seen is whether the appellants have made out a prima facie case for the grant of waiver of pre-....