9911796707
TMI Blog2009 (11) TMI 507X X X X Extracts X X X X X X X X Extracts X X X X ..... e control copy of the bill of entry had not been submitted either to the authorised dealer or to the Reserve Bank of India. This was during the period 12-6-1985 to 21-11-1985. 2. On 19-2-2001, show-cause notice/memorandum had been issued by the Enforcement Directorate to 21 persons including the present petitioner who has been arrayed as respondent No. 12, i.e., Shailendra Swarup to show cause as to why adjudication proceedings as contemplated in section 51 of the Foreign Exchange Regulation Act, 1958 (hereinafter referred to as the 'FERA') be not initiated. On page No. 3 of the said document while enumerating the names of noticee's as per annexure B, it had been averred that the said persons, including present petitioner has been responsi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver incharge of the day-to-day business of the company. 5. Notice of the adjudication proceedings was issued on 8-10-2003. 6. Reply to this notice was given by the present petitioner on 29-10-2003 wherein for the first time it had been averred that the petitioner Shailendra Swarup is a practising Advocate and was only a part-time Non-Executive Director of Modi Xerox Limited; he was never incharge of or responsible for the conduct of the business of the company. 7. The Adjudication Proceedings culminated in the order dated 31-3-2004. The submissions of the present petitioner had been noted on internal page 18 of the said order. The present petitioner along with four other persons were held guilty for having contravened the provisions of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and how only five persons had been mailed out of 13 so-called directors of the company; present petitioner had no financial stakes in the company; he was in his professional capacity imparting legal advice only; he could not have been roped in; the Courts below have also failed to appreciate that the Company Secretary had on affidavit specifically averred that the present petitioner was only a part-time Director. 11. Attention has also been drawn to an order dated 13-2-2004 passed by the Special Director of the Enforcement Directorate wherein the plea of the petitioner that he was only a Non-Executive Director of M/s. Xerox Modi Corporation Ltd. had been accepted. It is submitted that the Special Director is a person who is superior in ran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Companies Act; it is only those category of persons who are incharge of and responsible to the company for the conduct of the business of the company shall be deemed to be guilty of the offence. It is submitted that the liability can be cast only on those persons who have something to do with the transaction; mere use of a particular designation of an officer without more may not be enough. Reliance has also been placed upon a judgment in Om Prakash Khaitan v. Shree Keshariya Investment Ltd. [1978] 48 Comp. Cas. 85 (Delhi). It is submitted that the present petitioner who is a full-time Advocate had agreed to be appointed as a director of the company only to give a favourable projection to the management of the company; he was on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (4) of the FERA relate to the period 12-5-1985 to 21-11-1985. The show-cause notice dated 19-2-2001 apart from the 21 persons mentioned in annexure B, was specifically addressed to the company who was arrayed as No. 1 and the present petitioner Shailendra Swarup arrayed as No. 2. This show-cause notice/memorandum had stated that the persons arrayed therein were responsible and incharge of the conduct of the business of the company at the relevant time when the import was made and as such rendered himself liable to be proceeded against under section 50 of the FERA. 16. The reply given by the company signed by the Company Secretary, Mukesh Dugar is dated 26-3-2001. The Company Secretary has detailed the names of 13 persons as Directors of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere are two mandatory requirements to be fulfilled :- (i)It should be stated that the persons sought to be arrayed as accused apart from a company was a person incharge of and responsible for the conduct of the company. (ii)Such a person was in that capacity at the time of the commission of the offence. 19. In the present case, the record reveals that this was an admission by the company itself through its Company Secretary in the reply dated 26-3-2001 wherein it was stated that the present petitioner is a director of the company. This was an answer to the specific averment made in the show-cause notice that Shailendra Swarup was incharge of the affairs of the company and responsible to it for the conduct of its business. This finding of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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