AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (3) TMI 1617
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....e the Impugned Order has found the following contraventions indulged in by the Appellant; i) Section 3 (b) of FEMA to the extent of Rs 1,53,69,010/-by making said payment for the credit of Mr Matteo of M/s ITAL Program and Mr Adamo of BGB Italia, persons resident outside India, culminating in a penalty of Rs. 3,50,000/-. (ii) Section 3(c) of FEMA to the extent of Rs. 39,00,000/- by having received an amount of Rs. 39,00,000/- by order of Mr. Zuhir residing in Dubai and the amount of Rs. 36,72,000/-seized from his residential premises is also found to be involved in the contravention of the provisions of section 3 (c) of FEMA and liable for confiscation in terms of provisions of section 13 (2) of FEMA culminating in a penalty of Rs. 10,50,000/- and confiscation of Rs. 36,72,000/-. (iii) Section 3 (a) to the extent of Euro 5000 by having purchased the foreign exchange from persons other than authorised person in foreign exchange and by having transferred Euro 1000 to Rita Babini, Export Manager of M/s Turri and the amount of Euro 1785 and AED 15 seized from his residential premises is also found to be involved in the contravention of the provisions of secti....
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....alue in the invoice so as to avoid duty on 40% of the value. The said 40% was paid to the suppliers through intermediaries located in Dubai by paying his representatives in India through Indian Currency and in turn intermediaries would transfer foreign exchange to the agents abroad. Ld. Counsel stated that even the phone numbers of the intermediaries are on record which also corroborate the veracity of the statements. Ld. Counsel for the Respondent therefore prayed for dismissal of the Appeal. 6. We have considered the rival submissions and the material on record. We find that the statements tendered by the Appellant are detailed and spread over several days. The Appellant tendered his statement under Section 37 of FEMA on 22.08.2013, 23.08.2013, 27.08.2013, 29.08.2013, 04.09.2013, 05.09.2013, and 03.10.2013. We also note that on search of the residential premises of the Appellant on 22.08.2013 Indian Currency of Rs. 36,72,000/- and foreign currency of EURO 1785 and AED 15 were seized. Besides, the currency seizure the documents labelled A, B, C, D1, D2, D3, E, F, G, H1, H2, I and J and a bunch of loose sheets consisting of visiting cards and slips containing account details of ....
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....license and photograph as the same person who was known to him as Chetan alias Dharamraj. Ld. Adjudicating Authority after having given thoughtful consideration has found the retraction given by Shri Nemichand of his statement dated 23.08.2013 as belated and after thought and therefore rejected. We also note that it is in reply to the Show Cause Notice (SCN) that the Appellant has denied the contents of his statements and given alternative explanations which do not appear to be convincing. The Appellant has failed to provide corroboration to his denial and alternative explanations. 10. In this regard, the following judgments of the Hon'ble Supreme Court are relevant so as to bring out that even if the statements are retracted these can be relied upon: The Hon'ble Supreme Court in the case of Vinod Solanki Vs Union of India [(2008) 16 SCC 537] has laid down the situations where the retracted statement of the noticee can be relied upon. In the Judgement (Supra) following has been observed in paragraph 23: "23. It is trite law that evidence brought on record by way of confession which stood retracted must be substantially corroborated by other independent and cogent evi....
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....ting the inculpatory statement lest the order will be vitiated." 11. The findings made by the Ld. Adjudicating Authority in paragraph 3.11 and 3.12 of the Impugned Order are being reproduced as follows which clearly bring out the contraventions of the provisions of FEMA by the Appellant (who is referred as Noticee No. 1 and Shri Nemichand has been referred as Noticee No. 2) ; "3.11 In view of the material evidence discussed above, I find that Shri B.M. Rakesh has made payments in Indian rupees to the extent of Rs 76,39,010 to unknown persons in India, as per the instructions of Mr. Zuhir residing in Dubai, for arranging transfer of equivalent amount of foreign exchange(Euro 1.32.687.66) to and for the credit of Mr Matteo of M/s ITAL Program and Mr Adamo of BGB Italia, persons resident outside India; that the Noticee No.1 had made payments in rupees to the extent of Rs 77,30,000 to Shri Nemichand Jain of Bangalore for arranging transfer of equivalent amount in foreign exchange (Euro 90,000) to and for the credit of Mr Matteo of M/s ITAL Program and Mr Adamo of BGB Italia, persons resident outside India with the assistance of Shri Poonam of Mumbai and Haneefa of Dubai; th....
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.... The pleas that there is no loss of foreign exchange cannot be a defense. The preamble to FEMA lays down that the Act is to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India. If everyone starts remitting money for their imports through non banking channels, it would definitely deleteriously affect the orderly development and maintenance of foreign exchange market in India. The other assertion that the seized amount of Rs. 36,72,000 is not involved in contravention of the provision of section 3(c) of FEMA can be accepted in the Noticee No.1 had submitted proof that the said amounts representing his commission has been received through banking channels from abroad. But no such proof is furnished by Noticee No.1 even now. After giving seven statements before the Assistant Director of Enforcement regarding his import and issues of payment for those imports spread over a period of two months, his attempt to pretend that he was not aware of the contents of his statement can at the best be described as an afterthought to esca....