2009 (5) TMI 764 - HC - FEMA

The petitioners herein are appellants who have filed appeals before the Appellate Tribunal for Foreign Exchange. These appeals are against penalty orders passed under the Foreign Exchange Regulation Act, 1973 (hereinafter referred to as FERA, for short) but were preferred after the repeal of the aforesaid Act by Foreign Exchange Management Act, 1999 (hereinafter referred to as FEMA, for short) with effect from 1st June, 2000. As per FERA read with Adjudication Proceedings and Appeal Rules, 1974, the Court fees payable on an appeal depends upon the quantum of fine and is subject to maximum Court fees of Rs.2,000/-. As per FEMA read with Foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000, the Court fees payable on an appeal before the Foreign Exchange Appellate Tribunal is Rs.10,000/-.

Summary

Issues Involved:
1. Determination of applicable court fees for appeals filed before the Appellate Tribunal for Foreign Exchange.
2. Interpretation of Section 49 of FEMA and Section 6 of the General Clauses Act, 1897.
3. Impact of the repeal of FERA by FEMA on pending and future appeals.

Issue-wise Detailed Analysis:

1. Determination of Applicable Court Fees for Appeals:
The primary legal question was whether Rule 6 of the Adjudication Proceedings and Appeal Rules, 1974 under FERA or Rule 10 of the Foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000 under FEMA would apply to appeals in cases where adjudicating orders were passed under FERA but after its repeal by FEMA. The court noted that under FERA, the court fees payable on an appeal depended on the quantum of the fine, subject to a maximum of Rs.2,000/-, whereas under FEMA, the court fees payable on an appeal before the Foreign Exchange Appellate Tribunal was Rs.10,000/-.

2. Interpretation of Section 49 of FEMA and Section 6 of the General Clauses Act, 1897:
Section 49 of FEMA and Section 6 of the General Clauses Act, 1897 were pivotal in deciding the applicable court fees. Section 6 of the General Clauses Act, 1897 stipulates that the repeal of an enactment does not affect any right, privilege, obligation, or liability acquired under the repealed Act. The court emphasized that the existing rights, privileges, or liabilities incurred are not affected unless expressly stipulated to the contrary. It was noted that Section 49 of FEMA, which repealed FERA, did not intend to destroy the rights and liabilities under FERA but only replaced the Appellate Board with the Appellate Tribunal.

3. Impact of the Repeal of FERA by FEMA on Pending and Future Appeals:
The court held that the repeal of FERA by FEMA did not obliterate the earlier statute for transactions that had already been initiated. Section 49(5)(b) of FEMA stated that any appeal preferred to the Appellate Board under FERA but not disposed of before the commencement of FEMA would be transferred to and disposed of by the Appellate Tribunal under FEMA. The court also noted that Section 49(6) of FEMA explicitly made Section 6 of the General Clauses Act, 1897 applicable, thereby protecting the rights, obligations, and liabilities under FERA. The court concluded that appeals against adjudication orders under FERA should continue to be governed by the provisions of FERA, including the court fees prescribed under the 1974 Rules, even after the repeal of FERA, as long as they are not inconsistent with FEMA.

Conclusion:
The writ petitions were allowed, and it was held that the petitioners would be liable to pay court fees on the appeals filed by them as per the provisions of FERA read with the Adjudication Proceedings and Appeal Rules, 1974. The court fees provisions of the 2000 Rules under FEMA were deemed not applicable to appeals filed under Section 52 of FERA against adjudication orders passed under FERA. The court emphasized that change of the appellate forum from the Appellate Board to the Appellate Tribunal did not affect the vested right to appeal or impose more stringent conditions for filing appeals.