2019 (3) TMI 1988 - HC - FEMA

FEMA - Offences committed under the repealed Act - HELD THAT - Section 49 of the FEMA deals with repeal and saving of the Act and the Appellate Board constituted under the Act was dissolved. Sub-section (4) of Section 49 of FEMA made a provision as to how offence committed under the repealed Act shall be governed by and in clause (b) of sub-section (5) of Section 49 a provision is made as to who would be competent to dispose of the appeals pending before the Appellate Board constituted under the Act and the pending appeals were ordered to be transferred for disposal to the Appellate Tribunal constituted under FEMA. There is no provision under Section 49 that if a person feels aggrieved by an order passed in respect of offence committed under the repealed Act, he would be entitle to file an appeal before the Appellate Tribunal constituted under FEMA. That being so, the mere fact that the Adjudicating Authority in order dated 30-3-2017 has prescribed that an appeal shall lie to the Appellate Tribunal for Foreign Exchange or an interim order has been passed by the said Tribunal staying recovery of penalty subject to payment/deposit of 20% of the amount would not enure to benefit of the appellants to assert their claim that the appeal is maintainable before the Appellate Tribunal under SAFEMA, FEMA, PMLA, NDPS, PBPT Act. We do not find an error much less illegality in the order impugned dated 6-2-2019. So far as challenge to the order dated 30-3-2017 passed by the Deputy Director, Directorate of Enforcement Jalandhar is concerned, the same cannot be challenged before this Court by filing an appeal against first order. In view of what has been discussed hereinbefore, finding no merit, the appeal fails and is accordingly dismissed in limine. However, nothing stated hereinbefore shall cause prejudice to the appellants to avail appropriate remedy, in accordance with law. In case the appellants prefer an appeal before a Competent Authority/Fora and law prescribes limitation for preferring such an appeal, the appellants would always be at liberty to raise a plea that as they had been pursuing their remedy before the Appellate Tribunal, delay in filing the appeal may be condoned.

Summary

Issues:
Challenge against order passed by Appellate Tribunal and Deputy Director, Directorate of Enforcement.

Analysis:
The appellants challenged the orders passed by the Appellate Tribunal for SAFEMA, FEMA, PMLA, NDPS, PBPT Act, New Delhi, and the Deputy Director, Directorate of Enforcement, Jalandhar. The Deputy Director imposed a penalty on the appellants for contravention of provisions of the Foreign Exchange Regulation Act, 1973 and FEMA. The appellants argued that the appeal should lie with the Appellate Tribunal for Foreign Exchange under FEMA. The Adjudicating Authority prescribed the procedure for filing an appeal to the Appellate Tribunal. However, the High Court observed that there is no provision under Section 49 of FEMA allowing appeals for offences committed under the repealed Act to be filed before the Appellate Tribunal constituted under FEMA. The High Court found no error or illegality in the impugned order dated 6-2-2019.

The High Court noted that the Act was repealed, and FEMA came into force on 1-6-2000. Section 49 of FEMA deals with the repeal and saving of the Act. It dissolved the Appellate Board constituted under the Act and provided for the transfer of pending appeals to the Appellate Tribunal under FEMA. The High Court emphasized that there is no provision allowing appeals for offences committed under the repealed Act to be filed before the Appellate Tribunal under FEMA. Therefore, the appeal challenging the order dated 30-3-2017 passed by the Deputy Director cannot be entertained by the High Court.

The High Court dismissed the appeal, finding no merit in the arguments presented. However, it clarified that the appellants can avail appropriate remedies in accordance with the law. If the appellants prefer an appeal before a Competent Authority/Fora and face a limitation for filing such an appeal, they can request condonation of the delay by citing their pursuit of remedy before the Appellate Tribunal as a reason. The High Court concluded that the appeal is dismissed, but the appellants retain the right to seek further legal recourse.