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TMI Blog1993 (3) TMI 263X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1982. In order to appreciate the proceedings before the Adjudicating Authority and the Appellate Board, it would be necessary to enumerate the facts in brief. In December, 1975, the company, Allana Sons (Private) Ltd., received an order from a Foreign Trading Company by name M/s. Meka Trading Co., Tehran, for supply of oranges and sour lemons. The said quantity of fruits was to be exported by the company Allana Sons from India to Tehran. At about the same time M/s. Banana and Fruit Development Corporation Ltd., Madras (BFDC), a Government of India undertaking were also to ship their cargo of bananas of the value of Rs. 21,00,000 to Meka Trading Co., Tehran on board M.V. 'Fuente', a vessel chartered by them from the Shipping Corporation of India. On learning that the said vessel was proceeding to Tehran and that there was some unutilised cargo space, on the request of Allana Sons, BFDC agreed to carry the cargo of Allana Sons on payment of freight charges. On December 17, 1975, Allana Sons loaded their cargo of oranges and sour lemons valued at U.S. dollars 25,365 C. F. equivalent to Rs. 2,33,134.20 and paid Rs. 67,273.10 as freight charges. It is pertinent to note that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectly relevant and material to the proceedings before us and this court by order dated January 6, 1993, allowed the civil application and accepted the additional documents as evidence on record after hearing both the parties. The facts as transpiring from the said documents and not disputed by the respondents are that there ensued a correspondence between the appellant Allana Sons and the Shipping Corporation of India as also BFDC. The relevant exhibits A, B, D, H, I, K, L, P, Q and R to Civil Suit No. 495 of 1979, reflect this position. The Shipping Corporation of India, however, failed to recover the said dues for the appellants. Long after these steps were taken by M/s. Allana Sons, it was on September 28, 1979, that a show-cause notice was issued by the Additional Director of Enforcement, New Delhi, to the appellant Allana Sons and its directors for the alleged contravention of provisions of section 18(2) of the FERA on the ground that they failed to repatriate the sale proceeds of the said shipment within six months. The appellants submitted their written explanation to the said notice. They denied the charge and strongly relied upon the telex messages exchanged between Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he BFDC not to proceed against the Meka Trading Co. as it was under liquidation. Thus, the attempts of Allana Sons for direct negotiations with the consignees were also frustrated. Before the Adjudicating Authority, further explanations were tendered and on December 31, 1980, the Additional Director held that the appellant-company and its directors had contravened the provisions of section 18(2) of the FERA and imposed penalty of Rs. 25,000 on Allana Sons and Rs. 5,000 on each of the directors. The appellants, i.e. , the company and its directors preferred three separate appeals before the FERA Board. By order dated April 23, 1982, the FERA Board upheld the order of the Additional Director of Enforcement but reduced the penalty amount imposed upon the appellants. The penalty of Rs. 25,000 on Allana Sons was reduced to Rs. 10,000 while the penalty amount of Rs. 5,000 imposed on each of its directors was reduced to Rs. 2,000 each. This FERA Board's order is a common order dated April 23, 1982, against which the present three appeals have been carried by the company and its directors. It is the case of the Enforcement Authority that the appellants had contravened the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2)(A)( a )( ii ) in that where any export of goods has been made, no person shall except with the permission of the Reserve Bank, do or refrain from doing anything or take or refrain from taking any action which has the effect of securing ... that payment for the goods is delayed beyond the period prescribed under clause ( a ) of sub-section (1). It is strongly urged by Shri Karmali that the appellants have not contravened the provisions of section 18(2) of the FERA inasmuch as they have neither done nor refrained from doing anything and they neither did nor refrained from taking any action which had the effect of securing that the payment of the said goods is delayed beyond the prescribed period for its recovery. Shri Karmali also pointed out the finding of the Appellate Board as it appears in paragraphs 12 and 13 of the impugned order. It would be useful to reproduce the said finding : "12. I have considered the rival contentions of the parties. Events have taken place in an unforeseen manner and quite contrary to normal practices and one does not expect the carrier to deliver the goods to a consignee without proper documents and contrary to instructions. The Shipping Corpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecure payment within the specified period, in our opinion, there would be no contravention of section 18(2) of the FERA. The present circumstances appear to indicate a helpless situation and a helpless party where we cannot visualise any contravention of section 18(2) of the FERA. At any rate even assuming that there was a presumption that the appellants have failed to secure the payment within the prescribed time, the said presumption is rebuttable and the facts on record clearly show that the appellants have taken all reasonable steps to realise and recover payments and not only that, they had filed a civil suit long before the department even thought of show-cause proceedings. This is, therefore, not a case where the party can be branded as guilty of contravention of section 18(2). The documents of the transaction, the conditions of transfer and in particular the instructions that under the said bill of lading the cargo of Allana Sons was to be delivered to the order of the Bank of Sadarat Iran, Iranshahr, Snomali branch and the party to be notified was Meka Trading Co. shows that the exporters had taken all necessary precautions for realising the foreign exchange in the value o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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