1995 (12) TMI 431 - AT - FEMA

Summary

Issues:
- Penalty imposed for contravention of Foreign Exchange Regulation Act, 1973
- Failure to realize proceeds of exports
- Allegations against the appellant
- Misconception of facts by the adjudicating authority
- Lack of evidence refutation by the Senior Manager of the bank

Analysis:

The judgment pertains to an appeal against a penalty imposed on the appellant for contravention of the Foreign Exchange Regulation Act, 1973, regarding the failure to realize the proceeds of exports. The appellant, a proprietor of a business, exported goods to West Germany but faced challenges with the delivery of export bills to the correct party, resulting in the foreign buyer refusing to accept the goods. The appellant made efforts to redirect the bills to alternate buyers but faced delays due to the bank's actions. The appellant's complaint against the bank under the Consumer Protection Act further supported these facts.

The appellate tribunal found that the charge of contravention against the appellant was not sustainable in law or on facts. The delivery of goods to the foreign buyer had been frustrated due to the bank's errors and negligence, absolving the appellant of blame for non-realization of export proceeds. The tribunal highlighted that the appellant had not made exports against an advance payment and that evidence regarding the auction of goods should have been with the appellant's bank. The adjudicating authority's adverse inferences were deemed unjustified, especially regarding the appellant's efforts and the evidence possessed by the bank.

The tribunal criticized the adjudicating authority for misconceiving facts and ignoring crucial evidence, such as the documentary proof in the bank's possession. The authority's findings regarding the appellant's alleged lack of efforts for repatriation of export proceeds were deemed unfounded, given the circumstances of the failed delivery to the foreign buyer. Ultimately, the tribunal set aside the impugned order, citing the lack of cogency in the findings and the failure to consider the evidence on record.

In conclusion, the appellate tribunal allowed the appeal, overturning the penalty imposed on the appellant for the alleged contravention of the Foreign Exchange Regulation Act, 1973. The judgment emphasized the importance of considering all relevant facts and evidence in such cases to ensure a fair and just outcome.