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TMI Blog2024 (9) TMI 509X X X X Extracts X X X X X X X X Extracts X X X X ..... of justice, the penalty amount needs to be reduced, instead of remanding it back to the Adjudicating Authority, as the matter is about 25 years old and the chances of tracing out the record by both the sides seems to be difficult. In sequel to our discussion in the preceding para, the amount of penalty imposed on erstwhile M/s Owens Brockway India Pvt., now, Hindustan National Glass Industries Ltd. is hereby reduced to Rs. 2.5 lakhs. The impugned order passed by the Adjudicating Authority is modified accordingly. - SHRI V. ANANDARAJAN : MEMBER And SHRI RAJESH MALHOTRA : MEMBER For the Appellant : None For the Respondent : Mr. Mahip Datta Parashar, Adv. Mr. Rahul Mehta, Adv ORDER Dictated By: Rajesh Malhotra Present appeal under Section 52 of Foreign Exchange Regulation Act, 1973 read with Section 19 of Foreign Exchange Management Act, 1999 is filed by the appellant against the Order No. SDE/SKP/III/73/2002dated 04.08.2003, whereby penalty of Rs.2 crores was imposed on M/s Owens Brockway (I) Ltd. under Section 50 of FERA, 1973 and personal penalty of Rs.40 lakhs each was imposed on S/Sh. Shyam Sunder Lal, Hemant Luthra, Santosh Kumar Gupta, and Gursharan Singh Johar. 2. As per the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y or quantity different from that specified by him at the time of acquisition of the foreign exchange, such person shall, unless the contrary is provided, be presumed not to have been able to use the foreign exchange for the purpose for which he acquired it or, as the case may be, to have used the foreign exchange so acquired otherwise than for the purposes for which it was acquired Section 68 of the Foreign Exchange of Regulation Act, 1973 read as under: - Where a person committing a contravention of any of the provisions of this Act or of any rule, direction or order made thereunder is a company, every person who, at the time the contravention was committed, was in-charge of, and was responsible to the company for the conduct of business of the company as well as the company shall be deemed to be guilty of the contravention and shall be liable to be proceeded against and punished accordingly Explanation: - For the purpose of this section (i) Company means anybody corporate and includes a firm or other association of individuals and (ii) Director , in relation to a firm, means a partner in the firm. By his/their failure to furnish the Exchange Control Copy of Bill of Entry as proo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ECM, 1995 read with Section 49(3) and 49(4) of Foreign Exchange Management Act, 1999. On the basis of said impugned order,Certificate of Public Demand was issued against the appellant company. Aggrieved by the said demand letter and the impugned order,the appellant company filed the present appeal. 3. During the arguments,none appeared on behalf of the appellant M/s Hindustan National Glass Industries Ltd.However, written arguments on behalf of appellant drafted by Sh. Prem Ranjan Kumar, Adv. are available on record. The said written arguments reflects thatM/s ACE Glass Container Ltd. purchased the shares of M/s Owen Brockway (I) Ltd. having registered office at E-13, Green Park Main, New Delhi, a company registered under Companies Act, 1956, as per the proper approval by Reserve Bank of India vide letter dated 01.01.2002, which is at page No. 12 of the Appeal Memo.This letter gave clearance to M/s ACI India LLC under section 6(3) of FEMA permitting the transfer of shares. The clause 8 of this letter reflects that- The permission is only from exchange control angle and the buyer and seller may act in terms of instruction/restrictions, if any, placed by regulatory/statutory author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance for which the present proceedings has started. He argued that the impugned order has been passed in violation of Principle of Natural Justice, in as much as the Show Cause Notice (SCN) issued to M/s Owen Brockway (I) Ltd. was received back with the remark No Such Person and therefore, the SCN remained un-served on M/s Owen Brockway (I) Ltd. He stressed that any demand or any proposed penalty is required to be served on such person as contemplated under the Act. In the present case, the SCN was returned un- delivered and therefore, it was incumbent on the issuing authority to serve the same by other mode of service i.e. by affixation on the last known address or by publication, which was not done and ex- parte order was passed holding that much time has elapsed since the issue of SCN. He pointed out that the notice for personal hearing dated 18.07.2003 was also returned un-delivered with the remarks No such Person and therefore, M/s Owen Brockway India Ltd. and also the present appellant, who has stepped into the place of M/s Owen Brockway India Ltd. was completely un-aware of any such proceedings pending before the Ld. Adjudicating Authority. He also pointed out the certificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udicating Officer and quashed the same and held in para 7 that . there was hardly any doubt left regarding genuineness of the transactions which fact is not even disputed by the respondents. In these circumstances. the omission of the petitioners is merely a procedural irregularity . In the appeal paper book appellant annexed Bill of Entryat page no. 18, which is not clearly legible. However, it appears to be B.E. No. 1711 dated 11.06.1998 and the value of imported consignment as NLG 39021.75. The legible invoice dated 11.05.1998 annexed with this B.E. bears the same particulars. Accordingly, it is apparent that against remittance of NLG 39021.75, the consignment is already imported by Owens Brockway India Ltd. Another Bill of Entry No. 1711 dated 11.06.1998 for sum of NLG 26658.75 at page 24 of the appeal paper book, along with invoice dated 11.05.1998 of the same value at page 20, proves the fact that the goods were imported by Owen Brockway India Ltd. against the remittance of NLG 26658.75. Therefore, goods are apparently imported with respect to these two remittances. It is pertinent to mention here that appellant also filed copy of invoice acknowledgement of ABN Amro Bank for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is of Letter No. EC.DEL.BEF (ED)/3758/99-00 dated 02.05.2000 from Reserve Bank of India, Exchange Control Department, New Delhi, addressed to the Director of Enforcement along with its enclosures.Ld. Counsel for respondent ED failed to point out the contents of said letter dated 02.05.2000 and its enclosures to check the allegation of alleged contravention with respect to remittance and non-submission of import document along with Exchange Control Copy of Bill of Entry. The memorandum dated 31.05.2002 is silent regarding the next date of hearing before the Adjudicating Authority. There is nothing on record that when how this memorandum was served upon the Noticee(s). No efforts were made by the O/o Adjudicating Authority to check the status of the company and its present address. The ex-parte proceedings were apparently conducted in haste, on account of sun-set period. It is discernible that there is apparent mistake in taking one remittance entry as NLG 4207750.00 dated 30.03.1998, instead of FRF 420750.00 dated 30.03.1998, as per invoice for importing goods from France through M/s GG CADE Industries Ltd. of England. The original invoice of the same is at page 25 of the appeal pap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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