9911796707
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Issues:
Violation of section 18(2) of the Foreign Exchange Regulation Act, 1973 leading to penalties on appellants. Premature adjudication proceedings. Adequacy of steps taken by the appellant in filing a civil suit for realization of export proceeds. Requirement of seeking write-off from RBI. Necessity of seeking assistance from other authorities like the Indian High Commissioner in Bangladesh. Analysis: The appeal was filed against an Adjudication Order imposing penalties on the appellants for contravention of section 18(2) of the Foreign Exchange Regulation Act, 1973. The appellants argued that the order was untenable as the proceedings were premature since the RBI had granted extensions for realization of export proceeds. The appellants had filed a civil suit against foreign buyers and banks, satisfying the proviso to section 18(3) by taking effective legal action. The respondents contended that the efforts made by the appellants were inadequate and that they should have obtained write-off from the RBI or sought assistance from other authorities like the Indian High Commissioner in Bangladesh. The Chairman noted that the suit filed by the appellant was a significant step towards realizing export proceeds and rebutting the presumption under section 18(3). The Chairman rejected the argument that the appellant should have approached the RBI for write-off, stating that the RBI could not consider write-off until the suit was decided. The lack of evidence regarding seeking assistance from the Indian High Commission was deemed immaterial as the interactions between parties during the export process were evident. The Tribunal found that the adjudication proceedings were premature despite the RBI granting extensions up to March 1997. The Adjudicating Officer's presumption that the appellants did not have further extensions from the RBI was deemed unjustified. The Tribunal emphasized that even if the RBI refused an extension, the focus should be on whether the appellant took reasonable steps for realization of export proceeds. Consequently, the first appellant was absolved of contravention of section 18(2), leading to the setting aside of the penalties imposed on all appellants in the impugned order. In conclusion, the Tribunal allowed the appeal, setting aside the penalties imposed on the appellants. The judgment highlighted the importance of the steps taken by the appellants in pursuing legal action for realization of export proceeds and emphasized the need for adjudication authorities to consider the circumstances and efforts made by parties before reaching conclusions on contraventions.
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