TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 1198
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.... imposed for contravention of Section 3(a) and 4 of the Act of 1999 and Rs. 50 Lakhs for contravention of Section 8 of the Act of 1999 read with Regulations 3&7 of the Foreign Exchange Management (Realisation, Repatriation and Surrender of Foreign Exchange) Regulations, 2000 (in short 'Regulations of 2000'). Apart from the penalty, an order was passed to confiscate seized amount of Rs. 13,50,000/-. Brief facts of the case: 2. It is a case where the appellant was found involved in importing used Zerox machines from USA in the name of different companies. It was revealed when the residential and business premises of the appellant were searched by the respondents on 12.11.2007. The documents apart from Indian currency of Rs. 13.5 Lakhs w....
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....he imported approximately 3500 unit of photocopier machines. He paid a sum of Rs. 5 Crores towards the supply of 3500 units and also through one Raja of Chennai whose mobile number was also disclosed. The differential amount was accordingly paid by him out of the sale proceeds of 3500 units of photocopier machines. 60% of the amount through non-banking channel was arranged which was approximately 30,000 US Dollars followed by 50,000 US Dollars and so on which, according to the counsel for the appellant, remained a sum of Rs. 7 Crores in all. The penalty of Rs. 23 Crores was accordingly imposed for contravention of Section 3(d) of the Act of 1999. 4. The statement was further made in reference to the documents in the shape of receipts giv....
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....ation for confiscation exists because amount aforesaid was not involved in contravention of any of the provisions of the Act of 1999. The amount aforesaid was not transacted or passed on to anyone to make out contravention of the Act of 1999 and, therefore, no justification exists to confiscate the amount. The prayer was made to cause interference in the order in that regard also. 8. The challenge was made even to the imposition of penalty of Rs. 50 Lakhs for contravention of Section 3(a) and 4 of the Act of 1999 apart from Rs. 50 Lakhs for contravention of Section 8 of the Act of 1999 read with Regulations 3&7 of the Regulations of 2000. The penalty of Rs. 50 Lakhs has been imposed for receipt of 50000 Singapore Dollars from the sister-....
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....e to the issues raised by the appellant. It is to avoid repetition of one and the same facts and for the sake of brevity. Finding of the Tribunal: 11. The impugned order has been challenged by the appellant on many fold grounds. However, so far as the contravention of Section 3(d) of the Act of 1999 is concerned, the prayer was made to cause interference on the penalty amount to make it proportionate to the alleged contravention. The counsel for the appellant could not controvert the allegations about the contravention of Section 3(d) of the Act of 1999. The allegation against the appellant was about importing second hand photocopier machines with the arrangement to make payment of 60% of the amount by non-banking channel i.e. through....
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....nalty of Rs. 50 Lakhs has been imposed which we again find it to be disproportionate to the amount involved in the contravention. The counsel for the appellant did not make argument to challenge allegation of contravention of Section 3(a) and 4 of the Act of 1999 but prayed for making penalty to be proportionate. Accordingly, we considered the matter and taking into consideration the amount involved for contravention of Section 3(a) and 4 of the Act of 1999, we reduce the penalty from Rs. 50 Lakhs to Rs. 25 Lakhs. 14. The same amount is involved for contravention of Section 8 of the Act of 1999 read with Regulations 3&7 of the Regulations of 2000. The appellant failed to take all reasonable steps to realize and repatriate Singapore Dolla....