TaxTMI 
TaxTMI 
2025 (10) TMI 182
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....EMA) read with Schedule II of Regulation 3 (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 ....
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....ty under Sub-Section 2 for which the said contravention 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 considerati....
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....r any immovable property other than agricultural land/farm house/ plantation property to an NRI or an OCI." In view 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 befo....
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....made or hereafter to be made, then, unless a different intention appears, the repeal shall not- (a) revive anything not in force or existing at the time at which the repeal takes effect; or (b) affect the previous operation of any enactment 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....
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.... We are, therefore, of the view that the High Court in not referring to Section 24 of the General Clauses Act has fallen into error. Section 24 states: "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 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....
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.... Punjab v. Harnek Singh, (2002) 3 SCC 481, this Court held:- "17. Section 24 of the General Clauses Act deals with the effect of repeal and re-enactment of an Act and the object of the section is to preserve the continuity of the notifications, orders, schemes, rules or bye-laws made or issued under the repealed Act unless they are 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 th....
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....fication in section 54G, the notification declaring Thane to be an urban area dated 22.9.1967 would continue under and for the purposes of Section 54G. It is clear, therefore, that the impugned judgment in not referring to section 24 of the General Clauses Act at all has thus fallen into error. 23. But then Shri Arijit Prasad put before us two roadblocks 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 res....
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..... Therefore the ratio of that case is not applicable to the present case. With respect we agree with the principles laid down by the Constitution Bench in Rayala Corpn. Case [(1969) 2 SCC 412 : (1970) 1 SCR 639] . In our considered view the ratio of the said decision squarely applies to the case on hand." 27. The Kolhapur Canesugar Works Ltd. judgment also concerned itself with the applicability 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. 2....
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.... of the General Clauses Act, "omissions" made by the legislature would not be included. Assume, on the other hand, that the Constitution Bench had given two reasons for the non-applicability of Section 6 of the General Clauses Act. In such a situation, obviously both reasons would be ratio decidendi and would be binding upon a subsequent bench. However, once it is found that Section 6 itself would not apply, it would be wholly superfluous 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 subst....
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....d......." (At page 484) 35. The two later Constitution Bench judgments also did not have the benefit of the aforesaid exposition of the law. It is clear that even an implied repeal of a statute would fall within the expression "repeal" in Section 6 of the General Clauses Act. This is for the reason given by the Constitution Bench in M.A. Tulloch & Co. that only the form of repeal differs but there is no difference in intent or substance. If even an implied repeal is covered 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/om....
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.... and held that Section 6A shows that a repeal can be by way of an express omission, obviously what was meant was that an amendment which repealed a provision could do so by way of an express omission. This being the case, it is clear that Section 6A undisputedly leads to the conclusion that a repeal would include a repeal by way of an express omission. ................ 23. Fibre Board's case is a recent judgment which, as has correctly been argued by Shri Radhakrishnan, learned senior counsel on behalf of 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 clearl....
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....ravention under sub-section (1), may, if he thinks fit in addition to any penalty which he may impose for such contravention direct that any currency, security or any other money or property in respect of which the contravention has taken place shall be confiscated to the Central Government and further direct that the foreign exchange holdings, if any, of the persons committing the contraventions or any part thereof, shall be brought back into India or shall be retained outside India in accordance with the directions made in this behalf." We thus find 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 me....