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TMI Blog2008 (1) TMI 992X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner s firm had effected shipment of goods valued at US $ 77,67,356 under the cover of GR forms without any permission from the Reserve Bank of India (RBI) in violation of Sections 18(2) and (3) FERA read with a Central Government Notification dated 1.1.1974. Admittedly, on the same set of facts and for the same alleged contravention a second Show Cause Notice No. T-4- 87-D of 2002 dated 2.5.2002 was issued to the petitioner by the Respondent. 3. Following the first show cause notice issued on 18.9.2001, the Respondent filed Criminal Complaint No. 262/1/2002 against the petitioner in the court of the learned ACMM, New Delhi on the same set of facts for proceeding against the petitioner under Section 56 FERA for the offences under Sections 18(2) and 18(3) FERA, the Central Government notifications dated 1.1.1974 and Sections 49(3) and 49(4) FEMA. On 16.4.2002 the learned MM took cognizance of the complaint. Since the complaint was filed by a public servant in the discharge of his official duties, the presence of the complainant and the recording of pre- summoning evidence was dispensed with. After going through the complaint, the learned MM issued a summoning order for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77,67,356 under the cover of GR forms without any permission from RBI etc. In this complaint summoning orders dated 16th April 2002 were issued. However, on the same allegations and in respect of the same transaction the Enforcement Directorate filed another complaint under the same provisions, which is Complaint Case No. 262/02. In this case also summoning orders dated 31st May 2002 have been issued. It is further stated that realizing that the two complaints are in respect of the same alleged offence, the learned ACMM has now passed order dated 21st January 2006 clubbing the two complaints and directing that they be tried jointly. Submission of learned Counsel for the petitioner is that for the same alleged offence two complaints cannot be filed and, therefore, there is no question of having joint trial and the second complaint was clearly impermissible. Learned Counsel for the State wants to take instructions in the matter. At her request, adjourned to 23rd August 2006. 8. Learned Counsel for the petitioner points out that thereafter by a letter dated 11.4.2007 the Department of Revenue conveyed to the Director of Enforcement the decision of the Central Government to uncondi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to that issue stands settled by a series of judgments of the Supreme Court including Standard Chartered Bank v. Directorate of Enforcement (supra). The issue in the present case, on the other hand, is whether the exoneration of the petitioner on merits in the adjudication proceedings would render the pending criminal proceedings unsustainable in law. It requires to be noticed although the adjudication order is an appealable one, the Enforcement Directorate has chosen not to challenge it and it has, therefore, become final. 12. The adjudication order is a detailed one on merits. In regard to the principal allegation against the petitioner s firm that it had not taken steps to recover the US $ 7767356, the Special Director came to the following conclusions: From the above it is clear that the said noticee acted prudently and anticipated the situation to their best interest by retaining the advance remittance and import payment. The notice after having anticipated the deteriorating financial condition of the foreign buyer immediately took action by filing claim against the German buyer before the German Court. Number of documentary evidence furnished by the notice leaves no doub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be recovered from the foreign buyer and the drawee/foreign buyer company has gone into liquidation. Hence, we have forwarded the write off representation of the party to RBI. In view of above I do not hold the said notice guilty of the said contravention for non-realisation of export proceeds to the extent of US $ 7767356/-. 13. On the facts of the present case, it appears to this Court that the decision of this Court in Sunil Gulati applies on all fours. This is evident from the following paragraph where after discussing the judgment of the Supreme Court in Standard Chartered Bank this Court observed: 16. However, in the present case, we are not concerned with this question. A fine distinction of the issue involved in the case before the Supreme Court and before us in the present case has to be borne in mind. No doubt, as per the aforesaid judgment of the Supreme Court, adjudication proceedings as well a criminal proceedings can be initiated simultaneously. In fact, for initiating criminal proceedings one does not have to wait for the outcome of the adjudication proceedings. Therefore, filing of the criminal proceedings by the department against the petitioner in the insta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udication is on technical ground or by giving benefit of doubt and not on merits of the adjudication proceedings were on different facts, it would have no bearing on criminal proceedings. If, on the other hand, the exoneration in the adjudication proceedings is on merits and it is found that allegations are not substantiated at all and the concerned person(s) is/are innocent, and the criminal prosecution is also on the same set of facts and circumstances, the criminal prosecution cannot be allowed to continue. The reason is obvious criminal complaint is filed by the departmental authorities alleging violation/contravention of the provisions of the Act on the part of the accused persons. However, if the departmental authorities themselves, in adjudication proceedings, record a categorical and unambiguous finding that there is no such contravention of the provisions of the Act, it would be unjust for such departmental authorities to continue with the criminal complaint and say that there is sufficient evidence to foist the accused persons with criminal liability when it is stated in the departmental proceedings that ex-facie there is no such violation. The yardstick would, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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