1995 (4) TMI 322 - AT - FEMA

Summary

Issues:
1. Imposition of penalty for contravention of Foreign Exchange Regulation Act, 1973.
2. Allegations of aiding and abetting in transferring foreign exchange.
3. Validity of charge under section 8(1) read with section 64(2) of the Act.
4. Admissibility and evidentiary value of statements and documents.
5. Compliance with procedural requirements in adjudication proceedings.

Analysis:

1. The appeal stemmed from an adjudication order imposing a penalty on the appellant for contravening the Foreign Exchange Regulation Act, 1973. The appellant complied with the pre-deposit requirement, leading to the disposal of the appeal on its merits.

2. The case involved allegations of aiding and abetting in the transfer of foreign exchange, based on statements and documents seized during investigations. The appellant was charged with contravening section 8(1) read with section 64(2) of the Act.

3. The charge against the appellant was scrutinized for its compliance with the legal provisions. It was observed that the charge did not establish a contravention of section 8(1) and abetment thereof. The act of sending or taking foreign exchange out of India was deemed to fall under section 13(2) rather than section 8(1) of the Act.

4. The evidentiary value of statements recorded under section 108 and documents, such as a letter from Hong Kong Customs authorities, was questioned. The statements were disputed by the appellant, and discrepancies in factual details raised doubts about the validity of the evidence presented.

5. Procedural aspects of the adjudication proceedings were analyzed, highlighting deficiencies in the investigation and evidence collection process. The lack of verification of factual details and reliance on inadmissible evidence raised concerns about the fairness of the proceedings.

6. Ultimately, the appellate tribunal concluded that the charge of aiding and abetting in transferring foreign exchange could not be sustained against the appellant. The impugned order was set aside, directing the refund of the pre-deposit amount and clarifying that the decision did not impact separate proceedings related to alleged contraventions of section 13(2) before Customs authorities.