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Issues:
1. Appeal against penalty imposed for contravening provisions of Foreign Exchange Regulation Act, 1973. 2. Application for dispensation of pre-deposit of penalty. 3. Export of goods, refusal by buyer, efforts to find new buyer, RBI approval for discount, auction of goods by shipping company. 4. Adjudicating Officer's finding of guilt and imposition of penalty. 5. Disagreement with Adjudicating Officer's findings, appellant's efforts to avoid auction, RBI approval, balance amount remittance. 6. Appellant's actions in dealing with shipping company, absence of dues, steps taken for realization of sale proceeds. Analysis: 1. The judgment involves an appeal against a penalty imposed under the Foreign Exchange Regulation Act, 1973. The appellant appealed against the Adjudication Order imposing a penalty for contravening the provisions of section 18(2) and 18(3) of the Act. The appeal was accompanied by an application for dispensation of pre-deposit of penalty, citing the appellant firm's non-functional status since 1999 and a strong prima facie case. 2. The Tribunal allowed the dispensation application and proceeded to consider the appeal on its merits, taking into account the facts of the case and submissions from both parties. The central issue revolved around the alleged contravention of foreign exchange regulations by the appellant, leading to the penalty imposition. 3. The case involved the export of hand-knotted woollen garments to a buyer in Germany, who refused the shipment due to financial crises. The appellant sought a new buyer who demanded a discount on the invoice value. The RBI approved the discount request and extended the date for recovery of export proceeds. However, the shipping company auctioned the goods due to non-payment, leading to the penalty imposition. 4. The Adjudicating Officer found the appellant guilty of the charges, emphasizing that timely action could have prevented the auction. The officer noted the outstanding balance due to the appellant, concluding that their efforts were insufficient to absolve them of liability under the Act, resulting in the penalty imposition. 5. The Tribunal disagreed with the Adjudicating Officer's findings, highlighting the appellant's continuous efforts to prevent the auction by following up with the shipping agent and the new buyer. The RBI approval and actions taken by the appellant were considered sufficient to demonstrate their commitment to avoiding the auction and realizing the sale proceeds. 6. Regarding the balance amount, the appellant pursued the matter with the shipping company, which clarified that no further payment was due after adjustments. The Tribunal concluded that the appellant had taken all reasonable steps to avoid the auction and recover the sale proceeds, leading to the quashing of the imposed penalty and setting aside the Adjudicating Officer's order. The appeal was allowed in favor of the appellant.
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