2012 (10) TMI 1186 - HC - FEMA

Summary

Issues involved: Challenge to penalty imposed under FERA Act, delay in communication of order, applicability of FEMA Act, limitation period under Section 49(3) of FEMA Act.

The writ petition challenges a penalty imposed on the petitioner under the Foreign Exchange Regulation Act, 1973 (FERA Act) due to a delay in communication of the order. The main contention is the applicability of the Foreign Exchange Management Act, 1999 (FEMA Act) and the limitation period under Section 49(3) of the FEMA Act.

Challenge to Penalty under FERA Act:
The petitioner was penalized for obtaining foreign exchange for import of goods but failing to provide evidence of actual imports and not complying with regulations under FERA Act. The order imposing the penalty was communicated after a significant delay, raising concerns about procedural fairness.

Applicability of FEMA Act and Limitation Period:
The challenge is based on the repeal of FERA Act and the enforcement of FEMA Act, which requires contraventions under FERA Act to be addressed within two years from the commencement of FEMA Act. The petitioner argues that since no notice of contravention was served before the impugned order, the proceedings are invalid. However, the court notes that the alleged contravention was taken notice of before the expiry of the limitation period specified in Section 49(3) of the FEMA Act.

Court Decision:
The High Court dismisses the writ petition, directing the petitioner to pursue the available appellate remedy before the Appellate Tribunal under Section 19 of the FEMA Act. The court refrains from making a conclusive decision on the limitation issue, emphasizing the need for the petitioner to exhaust statutory remedies.