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2009 (5) TMI 536 - HC - Companies LawWhether the impugned judgment and order of the Appellate Authority dated 9-3-2007 while dismissing the appeal only on the ground of limitation which justifies or requires any interference by this Court? Held that - It is apparent that the Appellate Authority has not considered the provisions available under section 19 for condoning the delay even though the appeal in this case was not filed under FERA nor was it filed before FERA was repealed. Thus, the limitation which was prescribed under FERA was no more applicable to the appeal filed by the appellant in the present case. It is true that the appeal filed by the appellant was beyond limitation, jurisdiction was vested with the Appellate Authority by virtue of section 19 to consider the issue of condonation. It was for the Appellate Authority to have considered as to whether it is a fit case where the delay should be condoned or not. However, without applying the provisions contained under section 19 and merely relying upon the earlier provision is of FERA holding that appeal was barred by limitation, it is apparent that the Appellate Authority failed to exercise the jurisdiction vested in it under section 19 of FEMA and to that extent the order becomes unsustainable. Accordingly, the case, is remanded back to the Appellate Authority to consider the plea of limitation in the light of section 19 of FEMA. In case the delay is condoned then to hear the matter afresh.
Issues Involved:
1. Whether the impugned judgment and order of the Appellate Authority dated 9-3-2007 dismissing the appeal on the ground of limitation justifies or requires any interference by this Court. 2. Whether the appeal filed by the appellant before the First Appellate Authority, which was admittedly barred by limitation, could have been entertained by condoning the delay or converting the appeal into a revision. Detailed Analysis: Issue 1: Justification of the Appellate Authority's Dismissal on Grounds of Limitation The primary issue revolves around the Appellate Authority's decision to dismiss the appeal based solely on the delay in filing. The relevant dates are as follows: - The FERA bill became FEMA on 1-6-2000. - The RBI directed an investigation on 19-11-2001. - The Enforcement Directorate issued a letter on 21-12-2001. - The show-cause notice was issued on 29-5-2002. - The order-in-original imposing a penalty was passed on 23-9-2003. - The appeal was filed on 31-8-2004, with a delay condonation application filed on 18-5-2005. - The Appellate Tribunal dismissed the appeal on 9-3-2007 due to a 50-day delay. The appeal was dismissed without considering the merits, focusing only on the technical ground of limitation. The appellant argued that under Section 19(2) of FEMA, 1999, the delay was condonable, and the procedural law of the new Act should apply to pending appeals. Issue 2: Condonation of Delay or Conversion into Revision The appellant contended that: - The appeal was filed under FEMA, 1999, and the limitation period under FEMA should apply. - The order-in-original mentioned that an appeal would lie under Section 19 read with Section 49(5) of FEMA, 1999. - The procedural law of the new Act should apply to pending appeals. - The impugned order was against principles laid down in previous cases (Premier Ltd. v. UOI and Directorate of Enforcement v. Appellate Ld. Tribunal). - The appeal was dismissed on a mere technical ground of limitation without considering the merits. The respondents argued that: - The order-in-original had full details of the transaction, making the appellant's stand untenable. - Adjudication was initiated under FERA, 1973, and the appeal was a continuation of those proceedings. - The offence was committed under the repealed Act, and the order was in consonance with Section 6(e) of the General Clauses Act. The court noted that the appeal was dismissed on the ground of limitation, and the request to treat the appeal as a revision was not conceded. The relevant observations from the judgment highlighted that conversion of appeal to revision must be within the limitation period, and the appeal was filed 50 days beyond the 45-day limitation period. Relevant Provisions: - Section 52(2) of FERA allowed for an extension of the appeal period up to 90 days if sufficient cause was shown. - Section 19 of FEMA allowed for condonation of delay if sufficient cause was shown. The court observed that the Appellate Authority did not consider the provisions under Section 19 of FEMA for condoning the delay. The appeal was filed under FEMA, not FERA, and the limitation prescribed under FERA was no longer applicable. The Appellate Authority failed to exercise jurisdiction under Section 19 of FEMA, making the order unsustainable. Conclusion: The case was remanded back to the Appellate Authority to consider the plea of limitation in light of Section 19 of FEMA. If the delay is condoned, the matter should be heard afresh. The appellant must keep the Bank Guarantee alive until the question of condonation is resolved. If the delay is not condoned, the respondents are entitled to encash the bank guarantee. The appeal was disposed of accordingly.
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