2005 (12) TMI 614

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....of section 18(2) of FERA, 1973 (hereinafter referred to as 'the said Act'), a penalty of Rs. 1,10,000 on Shri T.B.S. Ahluwalia (appellant in appeal No. 494/86), a penalty of Rs. 1,00,000 on Shri Daljit Singh Ahluwalia (appellant in appeal No. 495/86) and a penalty of Rs. 35,000 imposed on Shri Harinder Singh (appellant in appeal No. 496/86) for contravention of section 18(2), read with section 68(1) of the Act. 2-3. The above appeal came up for hearing on 20-9-2005. Appellants were neither present nor represented in spite of the service of notice of hearing on them by affixation. Dr. Shamsuddin, DLA appeared on behalf of the respondent and filed service report which is taken on record. These are old appeals of 1986 where application for ....

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....t-firm on 2-3-1985 resulting recovery and seizure of documents. The statement of Shri Harinder Singh, appellant in appeal No. 496/86, a Power of Attorney holder for the appellant-firm was recorded. In the said statement it is, inter alia, admitted that appellant in appeal Nos. 494/86 and 495/86 are two non-resident partners of the appellant-firm and are residents in Germany. The export business of the appellant-firm was being looked after by the said Harinder Singh, appellant in appeal No. 496/86, on the basis of said Power of Attorney. The main foreign buyers of the export garments were M/s. H. Ahluwalia and M/s. Safashions of West Germany owned by the wives of non-resident partners Shri T.B.S. Ahluwalia and Shri Daljit Singh, respectively....

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.... dues within one and half years. Not agreeing a common adjudication proceeding was held. At the close of the proceedings appellants were found guilty and penalties stated above have been imposed. 7. In these appeals it has been contended by the appellants that as regards SCN-I they have not done anything resulting in loss of foreign exchange and it was submitted that adjustment in invoices made in respect of foreign buyer M/s. H. Ahluwalia of West Germany only for the purpose of settling mutual dues between the said foreign buyer and the appellants' firm. As regards the SCN-II has been contended that appellant had taken all reasonable steps to secure quick realisation of the dues from the foreign buyers. It has been further contended tha....

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.... appellants were fully aware of the affairs of the appellant-firm as well as the respective buyer firm. Shri Harinder Singh, appellant in appeal No. 496/86 was a person in-charge of the affairs of the appellant-firm and is person who had sighed all the GR Forms and other documents so he is fully responsible to the appellant-firm for his conduct. Appellants have failed to take any steps for realisations of the export proceeds and the ground such as recession in the foreign market, withdrawal of credit facilities are totally extraneous. It is also contended by Dr. Shamsuddin, DLA that appellants have failed to produce any evidence showing any payment has been received from these foreign buyers in which two of the partners of the appellant-fir....

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....t be ascertained at the time of export without the permission of the RBI. Section 18(2) of the Act reads as under : "Where any export of goods, to which a notification under clause (a) of sub-section (1) applies, has been made, no person shall, except with the permission of the Reserve Bank, do or refrain from doing any thing, or take or refrain from taking any action, which has the effect of securing- (A) in a case falling under sub-clause (i) or sub-clause (ii) of clause (a) of sub-section (1) : (a) that payment for the goods- (i) is made otherwise than in the prescribed manner, or (ii) is delayed beyond the period prescribed under clause (a) of sub-section (1), or (b) that the proceed....

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.... considered means appropriate and fitting in those particular circumstances. It cannot be said that the appellants have taken all reasonable steps for realisation of export proceeds. The appellants have failed to show any evidence what prevented them from realising the export proceeds from the foreign buyers who also happened to be closely related with two non-resident partners of the appellant-firm. In the above situations the findings of the adjudicating authority on this point cannot be faulted with. 13. As regards charge under section 68(1) of the Act it is not disputed that Shri T.B. S. Ahluwalia and Daljit Singh, appellants in appeal Nos. 494/86 and 495/86 being husbands of the proprietress of the respective foreign buyer M/s. H. A....