2008 (7) TMI 1100 - AT - FEMA

Summary

Issues:
- Appeal against adjudication order imposing penalty for contravention of FER Act 1973
- Application for dispensation of pre-deposit of penalty
- Application for recalling pre-deposit order
- Interpretation of Section 52(2) of FER Act 1973
- Failure to make pre-deposit leading to dismissal of appeal

Analysis:
The appeal before the Appellate Tribunal for Foreign Exchange was filed against an adjudication order imposing a penalty for contravention of Section 9(1)(d) of the Foreign Exchange Regulation Act, 1973. The penalty was imposed for a transaction involving payment to an individual in contravention of the Act. The appellant filed an application for dispensation of pre-deposit of the penalty, which was rejected by the Tribunal. The appellant was given 30 days to make the pre-deposit, failing which the appeal would be dismissed solely on this ground.

Subsequently, the appellant filed an application to recall the pre-deposit order, requesting to pay the penalty in installments. However, it was noted that the appellant had not made any pre-deposit, indicating a lack of bona fide intention in seeking a review and suggesting a mere attempt to delay proceedings. The Tribunal highlighted that as per Section 52(2) of the FER Act 1973, an appeal must be filed along with the pre-deposit of the penalty unless dispensation is allowed due to undue hardship, which was not the case here.

The Tribunal emphasized the importance of complying with judicial orders and the consequences of failing to do so. Referring to the provisions of Section 52(2) of the Act, the Tribunal noted that it had no authority to interpret the statute differently to avoid harsh consequences. Citing a Supreme Court judgment, the Tribunal reiterated the need to adhere to the plain language of the law. Despite granting dispensation of up to 90% of the penalty, the appellant failed to make any pre-deposit, leading to the dismissal of the appeal.

In conclusion, the Tribunal dismissed the appeal as the appellant failed to make any pre-deposit, either in full or in part, as required by the order dated 15.2.08. The lack of compliance with the Tribunal's directive resulted in the dismissal of the appeal, emphasizing the importance of adhering to legal procedures and orders in such matters.