TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 182
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.... (1)(b) of the Foreign Exchange Management (Permissible Capital Account Transactions) Regulations, 2000 of Foreign Exchange Management Act, 1999 & Regulation 3 (a) of the Foreign Exchange Management (Acquisition and transfer of Immovable property in India) Regulations, 2000 of Foreign Exchange Management Act, 1999. This Tribunal vide its Order dated 25.09.2024 disposed of the Application for waiver of the pre-deposit of the penalty amount with direction to the Appellant to pay an amount of Rs. 7,50,000/- within eight weeks, so as to meet the compliance to proviso of Section 19 of FEMA. 2. Ld. Counsel for the Appellant prayed that the impugned property was purchased from the lawful earning of the Appellant while he was working abroad. Ld. Counsel further argued that the bona fide of the Appellant cannot be questioned because he was not even aware of the said provision under FEMA. Ld. Counsel for the Appellant argued that while the impugned property was described as agricultural land, it was in fact not being used for agriculture purposes. Ld. Counsel contended that the Appellant purchased the said land to setup a poultry farm and a dairy farm. Ld. Counsel also argued that besides t....
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....vention has occurred. 5. Ld. Counsel for the Respondent pointed out that in spite of the Finance Act 2015 having been notified on 14.05.2015, the omission of Sub-Section 3 of Section 6 of FEMA came into effect only on 15.10.2019 vide S.O. 3715(E) dated 15.10.2019. He therefore maintained that the Complaint under 16 (3) of FEMA could have been lodged and the Show Cause Notice is valid. Ld. Counsel for the Respondent cited Judgments to contend that the contravention has occurred. He contended that there are Judgments which have held that omission and repeal are the same. In this regard, he cited the Judgments of the Hon'ble Supreme Court in the matter of Mithilesh Kumari vs. Prem Behari Khare, [(1989) 2 SCC 95 - Para 21] & Shree Bhagwati Steel Rolling Mills vs. Commissioner of Central Excise and Anr. [(2016) 3 SCC 643]. Ld. Counsel also cited the Final Order dated 08.04.2024 of this Tribunal in the Appeal No. FPA-FE-43-44/BNG/2023 in the matters of M/s Shell India Markets Pvt. Ltd. & Shri Nitin Prasad. He therefore pleaded to dismiss the Appeal. 6. We have considered the rival submissions and the material on record. On consideration of the arguments made from both the sides with re....
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....w of the aforementioned factual position, the invocation of Section 6(3)(i) read with Regulation 3(a) of the Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2000 further read with Schedule-II of Regulation 3(1)(b) of the Foreign Exchange Management (Permissible Capital Account Transactions) Regulations 2000 in the aforementioned Show Cause Notice read with the Complaint was in accordance with law in force at the relevant point in time. It is on record that the Complaint filed under Section 16(3) of FEMA is dated 22.05.2015 and the Show Cause Notice issued the matter is also of the same date. 7. We find that in the same position has been taken and elaborately explained by this Tribunal in the Final Order dated 08.04.2024 of this Tribunal in the Appeal No. FPA-FE-43&44/BNG/2023 in the matters of M/s Shell India Markets Pvt. Ltd. & Shri Nitin Prasad. The relevant paragraphs of the Final Order are cited as follows: "24.......... To analyse the legal issues, we may refer to Section 6(3)(b) as was existing before its repeal/omission and is quoted hereunder: ― 6. Capital Account transactions. (1) and (2) ....... (3) Without....
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....ctment so repealed or anything duly done or suffered thereunder; or (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or (d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed. 6A. Repeal of Act making textual amendment in Act or Regulation. - Where any (Central Act) or Regulation made after the commencement of this Act repeals any enactment by which the text of any (Central Act) or Regulation was amended by the express omission. 24. Continuation of orders, etc. issued under enactments repealed and re-enacted.- Where any (Central Act) or Regulation is, after the commencement of this Act, repealed and re-enacted with or without modification, then, unless it i....
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....his Act, repealed and re-enacted with or without modification, then, unless it is otherwise expressly provided any appointment notification, order, scheme, rule, form or bye- law, made or issued under the repealed Act or Regulation, shall, so far as it is not inconsistent with the provisions re-enacted, continue in force, and be deemed to have been made or issued under the provisions so re-enacted, unless and until it is superseded by any appointment notification, order, scheme, rule, form or bye-law, made or issued under the provisions so re- enacted and when any Central Act or Regulation, which, by a notification under section 5 or 5A of the Scheduled Districts Act, 1874, (14 of 1874) or any like law, has been extended to any local area, has, by a subsequent notification, been withdrawn from the re- extended to such area or any part thereof, the provisions of such Act or Regulation shall be deemed to have been repealed and re-enacted in such area or part within the meaning of this section." 20. In Poonjabhai Vanmalidas v. Commissioner of Income Tax, Ahmedabad, 1992 Supp. (1) SCC 182, this Court in construing Section 24 of the General Clauses Act held:- "7. The effect of Secti....
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....shown to be inconsistent with the provisions of the re-enacted statute. 23. We do not find any force in the submission of the learned counsel appearing for the respondents that as reference made in sub-section (2) of Section 30 of the 1988 Act is only to Section 6 of the General Clauses Act, the other provisions of the said Act are not applicable for the purposes of deciding the controversy with respect to the notifications issued under the 1947 Act. We are further of the opinion that the High Court committed a mistake of law by holding that as notifications have not expressly been saved by Section 30 of the Act, those would not enure or survive to govern any investigation done or legal proceedings instituted in respect of the cases registered under the 1988 Act. There is no dispute that the 1988 Act is both repealing and re-enacting the law relating to prevention of corruption to which the provisions of Section 24 of the General Clauses Act are specifically applicable. It appears that as Section 6 of the General Clauses Act applies to repealed enactments, the legislature in its wisdom thought it proper to make the same specifically applicable in the 1988 Act also which is a repe....
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....s in the form of two Constitution Bench decisions. He cited Rayala Corporation (P) Ltd. and M.R. Pratap v. Director of Enforcement, New Delhi, (1969) 2 SCC 412 which was followed in Kolhapur Cane Sugar Works Ltd. & Anr. v. Union of India & Ors., (2000) 2 SCC 536. He argued based upon these two judgments that an "omission" would not amount to "repeal" and that since the present case was concerned with the omission of Section 280ZA, Section 24 would have no application. 24. Shri Prasad is correct in relying upon these two Constitution Bench judgments for they do indeed say that in Section 6 of the General Clauses Act, the word "repeal" would not take within its ken an "omission". 25. In Rayala Corporation (P) Ltd., what fell for decision was whether proceedings could be validly continued on a complaint in respect of a charge made under Rule 132A of the Defence of India Rules, which ceased to be in existence before the accused were convicted in respect of the charge made under the said rule. The said Rule 132A was omitted by a notification dated 30th March, 1966. What was decided in that case is set out by paragraph 17 of the said judgment, which is as follows: "17. Reference wa....
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....y of Section 6 of the General Clauses Act to the deletion of Rule 10 and 10A of the Central Excise Rules on 6th August, 1977. 28. An attempt was made in General Finance Company & Anr. v. Assistant Commissioner of Income Tax, Punjab, (2002) 7 SCC 1 to refer these two judgments to a larger bench on the point that an omission would not amount to a repeal for the purpose of Section 6 of the General Clauses Act. Though the Court found substance in the argument favouring the reference to a larger bench, ultimately it decided that the prosecution in cases of non- compliance of the provision therein contained was only transitional and cases covered by it were few and far between, and hence found on facts that it was not an appropriate case for reference to a larger bench. 29. We may also point out that in G.P. Singh's Principles of Statutory Interpretation, 12th Edition, the learned author has criticized the aforesaid judgments in the following terms: "Section 6 of the General Clauses Act applies to all types of repeals. The section applies whether the repeal be express or implied, entire or partial or whether it be repeal simpliciter or repeal accompanied by fresh legislation. The s....
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....s to further state that on an interpretation of the word "repeal", an "omission" would not be included. We are, therefore, of the view that the second so- called ratio of the Constitution Bench in Rayala Corporation (P) Ltd. cannot be said to be a ratio decidendi at all and is really in the nature of obiter dicta. 32. Secondly, we find no reference to Section 6A of the General Clauses Act in either of these Constitution Bench judgments. Section 6A reads as follows: "6A. Repeal of Act making textual amendment in Act or Regulation - Where any Central Act or Regulation made after the commencement of this Act repeals any enactment by which the text of any Central Act or Regulation was amended by the express omission, insertion or substitution of any matter, then, unless a different intention appears, the repeal shall not affect the continuance of any such amendment made by the enactment so repealed and in operation at the time of such repeal." 33. A reading of this Section would show that a repeal can be by way of an express omission. This being the case, obviously the word "repeal" in both Section 6 and Section 24 would, therefore, include repeals by express omission. The absenc....
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....ered by the expression "repeal", it is clear that repeals may take any form and so long as a statute or part of it is obliterated, such obliteration would be covered by the expression "repeal" in Section 6 of the General Cl s Act". 32. The judgment in the case of Fibre Boards Pvt. Ltd. (supra) applies to the facts of this case. The detailed judgment of the Apex Court not only makes a reference of Section 6, 6A and 24 of the General Clauses Act but the previous judgment on the issue to hold as to whether it would be binding or be per incuriam. After detailed analysis. It has been held that repeal or express omission and substitution of any provision unless a different intention appears, the repeal/omission shall not affect the continuance of such enactment by the enactment so repealed and in operation at the time of such repeal. The detailed discussion on the issue has been made to show that words "repeal" and "omission" are interchangeable and even there is express omission of the provision it would remain in operation in a given case detailed out by the Apex Court. The judgments of the Apex Court in the case of Rayala Corporation (P) Ltd. and also of Kolhapur Cane Sugar Works Lt....
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....f the revenue, clarifies the law in holding that an omission would amount to a repeal. The converse view of the law has led to an omitted provision being treated as if it never existed, as Section 6 of the General Clauses Act would not then apply to allow the previous operation of the provision so omitted or anything duly done or suffered thereunder. Nor may a legal proceeding in respect of any right or liability be instituted, continued or enforced in respect of rights and liabilities acquired or incurred under the enactment so omitted. In the vast majority of cases, this would cause great public mischief, and the decision of Fibre Board's case is therefore clearly delivered by this Court for the public good, being, at the very least a reasonably possible view. Also, no aspect of the question at hand has remained unnoticed. For this reason also we decline to accept Shri Aggarwal's persuasive plea to reconsider the judgment in Fibre Board's case. This being the case, it is clear that on point one the present appeal would have to be dismissed as being concluded by the decision in the Fibre Board's case." 9. It has been contended that since the Appellant had no intention to contrave....
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....that there is nothing in the Section which can indicate directly or indirectly requirement of mens rea. Words like "willful", "deliberately", "intentionally" etc. are missing. The Hon'ble Supreme Court in the Judgment supra have cited the Judgment in Director of Enforcement vs. MCTM Corporation Pvt. Ltd. and Ors. Manu/SC/ 0300/1996 wherein even for FERA 1947 it was held that the contravention shall be breach of a civil obligation which would attract penalty irrespective of the fact whether the contravention was made with any guilty intention or not. The Judgment supra cited a number of previous judgments wherein it was held that mens rea is not an essential element for imposing penalty for breach of civil obligations. His Lordships have clarified that the case of Hindustan Steel Ltd. Vs. State of Orissa (supra) pertained to criminal/quasi criminal proceeding as the provisions of the Act under consideration in that case imposed a punishment of imprisonment and fine as well. The present appeal deals with provisions which are strictly civil obligations and penalty for the contraventions of these provisions are imposable under Section 13(1) of FEMA which provides for penalty only, up t....