2024 (11) TMI 797

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... 330 dated 14.05.2010 passed by the Special Director, Enforcement Directorate, Mumbai arising out of Show Cause Notice (SCN) No.T-4/32- B/SDE/KNR/05 dated 10.10.2005. Penalty of Rs. 40 Lakhs was imposed on M/s Mrugank Investments Limited and Rs.4 Lakh was imposed on each of the four Directors of the Company including the two Appellant Directors Shri Rais Ahmed & Shri Abdul Sagir Khan vide the Impugned Order for the contravention of Section 8 of the Foreign Exchange Management Act, 1999 r/w Regulation 9 & 13 of the Foreign Exchange Management (Export of Goods and Services) Regulation 2000. The Directors of the Company were charged for the said contraventions in terms of Section 42 of the Foreign Exchange Management Act, 1999 (FEMA). 2. Th....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....yers before the Mumbai High Court. However, on legal advice they withdrew their suits before the Mumbai High Court and fresh legal suits were filed in the High Court of Justice, London. In view of the reasonable steps which they had taken, the provisions of FEMA could not have been invoked against them. Ld. Counsel pleaded to allow the appeals, failing which, he prayed for reduction in the penalties. 4. Ld. Counsel for the Respondent argued that the Impugned Order is speaking order, which clearly brings out that the Appellants had contravened the provisions of FEMA. He stated that the Appellant Shri Rais Ahmed in his statement dated 15.04.2004 u/s 37 of FEMA admitted that M/s Mrugank Investments Limited was put on caution list of RBI for....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s. There is nothing on record to show that a suit was filed in the London Court. In fact, the Appellants have failed to produce any evidence to corroborate any direction from the London Court to their buyers to pay pending export proceeds. The conduct of the Appellants in filing Writ Petition before the Hon'ble Bombay High Court and thereafter having yet withdrawn does not reflect the same as reasonable step taken by the Appellants for realization of the pending export proceeds. The Appellants have also failed to show their correspondence with the High Commission of India in London, in-spite of directions to this effect by the RBI. We also find that the two appellants before us were the Directors of the Company who were responsible for the ....