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Issues:
Appeal against penalty under section 9(1)(a) of the Foreign Exchange Regulation Act, 1973; Application for dispensation of pre-deposit of penalty amount; Allegations of contravention of foreign exchange regulations; Consideration of financial hardship, prima facie case, and balance of convenience; Retraction of statement by appellant; Inconsistencies in statements of involved parties; Lack of proper investigation; Benefit of doubt to the appellant. Analysis: The appeal in this case was against a penalty imposed on the appellant for contravening section 9(1)(a) of the Foreign Exchange Regulation Act, 1973. The appellant sought dispensation of pre-deposit of the penalty amount, citing financial hardship, prima facie case, and balance of convenience. The appellant argued that the essential elements of the offense were not present in the case and relied on a previous decision to support their claim (para 2). The respondent opposed the appellant's request for dispensation, referring to the appellant's admission of making a payment to an individual outside India, which was not disclosed for income tax purposes. The respondent highlighted the appellant's annual income and argued for the deposit of the penalty amount before the appeal could be heard on merits (para 3). The Chairperson considered both parties' submissions and decided to dispense with the pre-deposit of the penalty, citing potential undue hardship based on a statement made by an individual involved. The case proceeded to be heard on merits (para 4). Upon reviewing the impugned order, it was noted that the adjudicating officer found the appellant guilty of contravening the provisions of section 9(1)(a) based on statements and transactions involving the purchase of NRE cheques (para 5). However, discrepancies and inconsistencies were found in the statements of the appellant and the other individual involved. The lack of proper investigation into conflicting statements raised doubts about the evidence on record. Ultimately, the benefit of doubt was given to the appellant due to the inconsistencies and contradictions, leading to the allowance of the appeal and setting aside of the order appealed against (para 7-8). The Chairperson expressed dissatisfaction with the investigation conducted in the case, suggesting that further inquiries should have been made into the transactions and arrangements between the parties involved. The lack of thorough investigation raised concerns about the validity of the allegations and the need for proper action against all relevant parties (para 9).
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