2006 (8) TMI 700 - AT - FEMA

Summary

Issues:
- Appeal against adjudication Order imposing penalty under FER Act, 1973 and FEM Act, 1999.
- Validity of proof of import of goods submitted by the appellant.
- Interpretation of sections 8(3) and 8(4) of FER Act, 1973.
- Compliance with obligations under FER Act, 1973.
- Comparison with legal precedent in Sunil Engg. Corpn. v. Union of India [2005] DLT 117.

Analysis:

The judgment pertains to an appeal against an adjudication Order imposing a penalty under the FER Act, 1973 and FEM Act, 1999. The appellant, M/s. Uttam Galva Steels Ltd., was penalized for a single remittance of foreign exchange. The appellant submitted a letter from their authorized banker, Canara Bank, explaining the bill of entries related to the remittance, which granted dispensation from pre-deposit of the penalty. The appeal was taken up for final disposal on merits.

The appellant's counsel argued that the bill of entries submitted by the appellant to the bank's Foreign Department proved the import of goods, fulfilling the obligations under the FER Act, 1973. On the other hand, the respondent's counsel contended that the impugned order should be upheld based on the RBI certificate and not the appellant's letter. After hearing both parties, the tribunal found that the appellant had imported the goods and fulfilled their obligations under sections 8(3) and 8(4) of the FER Act, 1973.

The tribunal referenced the case of Sunil Engg. Corpn. v. Union of India [2005] DLT 117, where it was held that the mere failure to file a bill of entry does not amount to a violation if the genuineness of the transaction is proven. In this case, the appellant had submitted proof of import of goods with their authorized banker, satisfying the requirements of the law. Therefore, the appeal was allowed, and the impugned order imposing the penalty was set aside.