TaxTMI 
TaxTMI 
TaxTMI 
2026 (3) TMI 155
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....agement Act, 1999 (FEMA) read with Regulations 14 (C) of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000 to the extent of Rs. 3,48,21,640/-. b. Rs. 70,00,000/- for the contravention of Section 7 of FEMA read with Regulation 3 (1) and Regulation 6A (1) (i) of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000 to the extent of Rs. 6,88,49,600/-. The individual Appellants Shri G. Sandeep and Shri Ashwin Gowri Shetty, who were the legal representatives and sons of Late Shri Prithvi Raj, the then Managing Director of the Appellant Company were penalized Rs. 6,00,000/- each for the aforementioned contraventions in terms of Section 43 of FEMA. 2. This Tribunal vide Order dated 28.11.2024 had directed the two individual Appellants to make pre-deposit of Rs. 30,000/- each within sixty days of the Order. The individual Appellants made the pre-deposits of Rs. 30,000/- each. However, Ld. Counsel for the Appellants submitted that the Appellant Company has been 'struck off' the rolls of the Register of Companies. The Appeal, if any, filed by the Appellant Company is not before us. 3. On perusal of Chapter XVIII of t....
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....tered under section 8. (4) A notice issued under sub-section (1) or sub-section (2) shall be published in the prescribed manner and also in the Official Gazette for the information of the general public. (5) At the expiry of the time mentioned in the notice, the Registrar may, unless cause to the contrary is shown by the company, strike off its name from the register of companies, and shall publish notice thereof in the Official Gazette, and on the publication in the Official Gazette of this notice, the company shall stand dissolved. (6) The Registrar, before passing an order under sub-section (5), shall satisfy himself that sufficient provision has been made for the realisation of all amount due to the company and for the payment or discharge of its liabilities and obligations by the company within a reasonable time and, if necessary, obtain necessary undertakings from the managing director, director or other persons in charge of the management of the company: Provided that notwithstanding the undertakings referred to in this sub-section, the assets of the company shall be made available for the payment or discharge of all its liabilities and ob....
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.... FEMA, 1999 the liability will devolve upon the official receiver or assignee in the case of a company and that the Appellant are neither the official receivers nor the assignees. Hence, the Appellant cannot be liable for the actions of PSPL or the liability of PSPL. Therefore, the Appellant cannot and will not be liable for the imposition of Rs. 35 Lakhs penalty for alleged violation of Section 7 of FEMA read with Regulation 14 C of the Export Regulations and Rs. 70 Lakhs penalty imposed for the alleged violation of Section 7 of FEMA read with Regulation 3 and 6 of the Export Regulations. Furthermore, the liability that has been imposed upon the Appellant, under Section 43 of FEMA, 1999 is also bad in law. Under Section 43 of FEMA, 1999 the liability of a legal representative is only to the extent of the inheritance or estate of the deceased. That it is submitted that the Adjudicating Authority has not considered the issue whether the Appellants have in fact inherited any property or estate but has directed the Appellant to pay the penalty. That the Adjudicating Authority while taking cognizance of Section 43 failed to take note of the proviso to Section 43 that clearly provides t....
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....the show cause notice vide a letter dated 27.09.2020. The contentions made in the said reply were already discussed in the above paragraphs. Accordingly, in view of the above discussions, I hold Shri G. Sandeep, Director, M/s. Priyansh Sea Foods Private Limited and also son & legal representative of deceased noticee-2 and Shri Ashwin Gowri Shetty, son of (Late) Prithvi Raj. Noticee-2 i.e., both sons and Legal representatives of (Late) Prithvi Raj, then Managing Director of M/s. Priyansh Sea Foods Private Limited are liable for penalty under Section 13(1) of FEMA, 1999." 7. Ld. Counsel for the Appellants has prayed for waiver of the penalty on the grounds that the individual Appellants did not intend to indulge in any contravention. He cited the Judgment of Hon'ble Supreme Court in the case of Hindustan Steel Ltd. vs. State of Orissa reported in [1969 (2) Supreme Court Cases 627]. The provisions of Section 13(1) of FEMA are reproduced below: "If any person contravenes any provision of this Act, or contravenes any rule, regulation, notification, direction or order issued in exercise of the powers under this Act, or contravenes any condition subject to which an authorisati....