1999 (8) TMI 1026

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....000 on the appellant in Appeal No. 221 of 1992 as the sole proprietor of Modula India for contravention of section 18(2), read with section 18(3), of the Foreign Exchange Regulation Act, 1973 ('the Act'). As these appeals have arisen from a common adjudication order. I proceed to dispose them of by this common order. 2. A show-cause notice bearing No. T-4/7-C/85, dated 20-8-1985 (hereinafter called SCN-I) was issued to (i) Modula (India) (P.) Ltd., and (ii) the appellant in Appeal No. 220 of 1992 C.R. Das in his capacity as director of the company alleging contravention of section 18(2), read with section 18(3) for non-realisation of export proceeds of Rs. 2,25,175. Simultaneously the second show-cause notice No. T-4/7-C/85, dated 20-8-1....

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....tion from pre-deposit of penalty should not be granted. It is also on record and not disputed that both the appellants had deposited Rs. 5,000 each against the penalty. After taking into consideration, the submissions of the parties it is decided to grant dispensation from pre-deposit of the remaining amount of penalty in both the cases. 4. The parties made their submissions on the merits of the appeal. This common order disposes of both the appeals. Appeal No. 220 of 1992 5. It is held by the adjudicating authority that the appellant is in contravention of section 18(2) in his capacity as director of the exporter-company. However, it is seen from the impugned order that there is no finding of guilt against the exporter-company. Th....

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....s the company whose business it is shall be deemed to be guilty. Hence, it is a basic requirement that the company must be in contravention, otherwise the person conducting the business of such company cannot commit any violation because when his principal as legal person is not in contravention, then the individual as natural person or agent can never be. The impugned order has imposed a penalty of Rs. 25,000 on the appellant in his capacity as director but has left the company without any adverse finding. Therefore, the impugned order is liable to be set aside. Unless and until guilt is established against the company, the individual in his capacity as director cannot be held guilty. 7. At this stage of the proceedings, Dr. Shamsuddin,....