TaxTMI 
TaxTMI 
TaxTMI 
2025 (8) TMI 1226
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....as under:- i. Rs. 10,00,000/- on M/s. Trikesh Trade Lind Pvt. Ltd. ii. Rs. 5,00,000/- on Shri Sarju Kr. Khandelwal, Director 2. The facts of the case, are that Complaint No. T-3/293-B/ 2017 dated 04.12.2018 was filed by the Deputy Director, Mumbai Zonal Office-I, before the Adjudicating Authority. After going through the allegations, the Additional Director issued Show Cause Notice to the Noticees' (herein respondents) for failing to realise the export remittance to extent of USD 31,21,341.650 (equivalent to Rs. 15,03,70,578/-). On notice, the said Noticee vide letter dated 28.06.2018 submitted the details of export made by them and export proceeds received as well as outstanding remittance. Statement of Sh. Sarju Kumar Khandelwal, Director of the company was recorded on 29.06.2018 under Section 37 of FEMA, 1999, wherein he stated that they have already submitted the details of exports remittance outstanding against them vide letter dated 28.06.2018. The said remittance could not be remitted because the overseas buyer absconded and they are trying to trace him and have already applied to RBI for permission to receive the said remittances. They exported goods (cut and polished....
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....e Adjudicating order is passed in favour of the department and imposing penalty is discretionary power of the Ld. Adjudicating Authority, the department cannot impose its view on quantum of penalty. Respondents have already paid entire penalty amount of Rs. 15,00,000/- in respect of Adjudication Order No. ADJ/06/ADE/SK/2019/FEMA dated 30.12.2019. Hence, the appeal is barred, not maintainable and deserves to be dismissed. He argued that Respondent No. 1 is in the business of precious metals and diamonds and had exported cut and polished diamonds to the overseas suppliers during the financial year 2009-10 for the total, tune of USD 12,298,442.35 (equivalent to Rs.59.63 crores), out of which Respondent No.1, had realized USD 9,177,100.7 (equivalent to Rs.44.52 crores), towards payment of export proceeds. They have earned foreign exchange for the country to the large amount as stated. He pointed out that approximately more than 75% of the amount of the proceeds for the export shipments were recovered. However, shipments made to Tifany Gold Pte Ltd and Western Alliance International Ltd. yielded adverse results whereby the said companies did not pay the amounts towards the invoices rais....
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.... herein also teetered on bankruptcy at that time and initiating legal proceedings against the overseas parties would have cost a lot of money in legal fee which the Respondents could ill afford. He further submitted that the Respondent No. 1 realized more than 75% of the exports and only two transactions with Tifany Gold Pte Ltd and Western Alliance International Ltd. turned adverse. He argued that the actions of the ED would have a debilitating effect upon the exporters in India who would always have a worry that in case any of their transaction(s) turns adverse, they would not only bear loss upon that transaction but also be subjected to various penalties and fines by the ED. He submitted that before deciding penalty, the Adjudicating Authority ought to have taken a holistic view of the circumstances which demonstrate that the Respondents took proper and reasonable steps within their means to recover the dues. Further, the Ld. Adjudicating Authority ought to have appreciated that more than 75% of the exports had been realized, hence even the imposition of said penalty does not arise. Further, the Adjudicating Authority itself held that there was no under invoicing or suppression ....
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....Adjudicating Authority. 7. The Hon'ble Supreme Court in State of MP and Ors. Vs. Bharat Heavy Electricals [(1997) 7 Supreme Court Cases 1] in its order dated 14.08.1997 held that in a statute prescribing the provision for penalty equal to ten times the amount of entry tax, the statute prescribed only a maximum limit and did not prescribe an irreducible amount depriving the assessing authority of any discretion in this regard. The stand of the State in the case supra conceded that the assessing authorities are not bound to levy fixed penalty equal to ten times the amount of entry tax. In fact, in the present case the statute (FEMA) itself provides for a penalty up to thrice the sum involved in such contravention and thereby gives explicit scope to the Adjudicating Authority to exercise his discretion, albeit judiciously, for imposition of penalty. 8. Now, after hearing the Ld. counsel for the respondents, we find the following points for imposition of penalty on the lower side: - - There is nothing on record that respondents have received any advance export incentive before exporting the consignment. - There is nothing on record that the export was bogus or consignments were o....