TaxTMI 
TaxTMI 
2023 (4) TMI 1360
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....t Directorate for the contravention of section 9(1)(c) r/w section 68(1) of the Foreign Exchange Regulation Act 1973 (FERA) for which Show Cause Notices were issued to the Appellants on 16-5-2002. 2. The Joint Director in the Adjudication Order dated 28-2-2014 made a finding that it is an admitted fact that against the amount of Rs. 1,03,21,220/-received from the NRIs by the Noticees (the Appellants here-in), as share application money, no share was allotted to them and the said amount continued under the head 'Share Application Money' in the records of the Noticee Company. He therefore held that the alleged charge under section 9(1)(c) of FERA stands established. He imposed penalty of Rs. 5 lakhs on each of the two appellants and ....
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....how issuing of shares against money received from the NRIs. The appellant failed to return the amount to the NRIs. Hence, the Company acknowledged a debt and thereby created a right in favour of persons resident outside India. FERA is a special law and hence the provisions of the Special Act shall apply to the exclusion of the other. He quoted part of the impugned Adjudication Order whereby the Adjudicating Authority rejected the plea of the Appellant that the records were lost in fire and the lock-out. He reiterated the written submission filed on 15-5-2018. 6. I have considered in depth the argument made by the Appellant and by the Learned Counsel for the Respondent. It is not in dispute that Rs. 1,03,21,220/- was received by the Company....
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....ent Limitation Act has been looked at. 9. In the case supra, cited by the Appellant in his written submission filed on 19-4-2018, the meaning of acknowledgement of debt has been clarified in the context of section 19 of the then prevalent Limitation Act: "The essential requirements of a valid acknowledgement under section 19(1) of the Limitation Act are that it must be made before the relevant period of Limitation has expired, it must be in regard to the liability in respect of the right in question and it must be made in writing and must be signed by the party against whom such right is claimed. It is thus clear that acknowledgement as prescribed by section 19 merely renew debt, it doesn't create a new right of action. It is a mere ....
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....it the existence of jural relationship such intention could be fastened on the maker of the statement by an involved or far-fetched process of reasoning." Broadly stated that is the effect of the relevant provision contained in section 19 of then prevalent Limitation Act. The Judgment further states that the substance of the provisions contained in section 19 of then prevalent Limitation Act has been succinctly given by Justice Fry L as early as 1884 in Green vs Humphreys "in my view an acknowledgement is an admission by the writer that there is a debt owing by him, either to the receiver of the Letter or to some other person on whose behalf the letter is received but it is not enough that he refers to a debt as being due from somebody.....