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TMI Blog2009 (9) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... S dollars 1 lakh from M/s. Omran Italian Jewellery, Sharjah, UAE and thereafter transferred the same to M/s. Al Abdulla, Jewellery Trades, UAE and further unauthorizedly acquired and then transferred Dhiram 168,000 to M/s. Omran Italian Jewellery, Sharjah. 2. This Tribunal while disposing of the application for dispensation of pre-deposit of penalty, firstly rejected the application by order dated 22-10-2007 but allowed the appellants to deposit their respective penalty within 30 days from the date of receipt of that order. However, when an application for modification was filed by the appellants bringing out the better factual details of these appeals, this Tribunal modified the pre-deposit order dated 22-10-2007 by recalling order dated 22-10-2007 and further allowed by order dated 28-7-2009, the appellants to file an undertaking on behalf of the appellant-company before Enforcement Directorate that the company will not dispose of its immovable property till the final disposal of these appeals. The appellants have complied with pre-deposit order dated 28-5-2009 of this Tribunal. Presently, these appeals are taken up for final disposal on merits. 3. We have heard Shri R.K. Handoo, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 73. We are not concerned that who owned the goods and how the manufacturing process took place. This Tribunal is concerned only with repatriation of export proceeds under section 18 of FER Act, 1973 and reasonability of efforts taken to recover the export price. Any help rendered by Excise and Custom Department in the process of manufacturing is hardly relevant for our consideration. This is an admitted position that MMTC Ltd. signed GRIs for export of goods after obtaining code number for making exports from RBI. The invoices and shipping bills are also signed by MMTC Ltd. As an overall picture, the following is not denied by MMTC Ltd.: (a) MMTC Ltd. can apply for write off/extension of time-limit to RBI and not the appellants. (b) MMTC Ltd. had taken all export benefit like duty drawback and income-tax exemption. (c) MMTC Ltd. can only withdraw the amount from bank and only can receive export price in its bank account. (d) Foreign buyers even where suggested by appellants must bear final approval of MMTC Ltd. (e) MMTC Ltd. had taken sales tax benefit. 6. Further the Agreement entered into between MMTC Ltd. and the appellants envisage the nature of business relationship between MM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods (i) is made otherwise than in the prescribed manner, or, (ii) is delayed beyond the period prescribed under clause (a) of sub-section (1), or ** ** ** (3) where in relation to any goods to which a notification under clause (a) of sub-section (1) applies the prescribed period has expired and payment, therefore, has not been made as aforesaid, it shall presume, unless the contrary is proved by the person who has sold or is entitled to sell the goods or to procure the sale thereof, that such person has not taken at reasonable steps to receive or recover the payment for the goods as aforesaid and he shall, accordingly, be presumed to have contravened the provisions of sub-section (2). 10. Sub-section (3) of section 18 provides that if exporter does not receive payment of goods exported within the prescribed period, it shall be presumed that the exporter has not taken reasonable steps to receive the payment for the exports. The rule 8 of Foreign Exchange Regulation Rules, 1974 provides that the amount representing the full export value of goods exported shall be realized and be paid to the authorized dealer, on the due date for payment or within six months from the date of shipment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l who might have performed any material act in making the export of the goods only as abettor who are aiding the activity. Here, it is necessary to notice that allegations levelled by SCN against the appellant are not of abetment, so we need not consider this aspect any more. Looking towards this situation, the arguments from DLA are required to be rejected having no basis whatsoever. The role played by MMTC Ltd. in the export of goods is quite substantial whereafter MMTC Ltd. cannot throw on the appellants the clutches of section 18(2), read with section 18(3) of FER Act, 1973 as an exporter. Moreover agent when authorized to do some act on behalf of the principal than liability of principal remains subsisting even though he employed an agent to accomplish some job. Therefore, MMTC Ltd. cannot escape the liability of an exporter imposed by section 18(2), read with section 18(3) of FER Act. 14. According to legislative scheme incorporated in section 18, the person who seeks to send goods outside India is required to file an undertaking, representing (1) the export value and (2) ascertainable time for recovery of the price. By sub-section (2) of section 18, the person who has filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nother foreign buyer of the goods. Here it will be appropriate to quote section 8(1) of FER Act, 1973 which reads as under : 8. Restrictions on dealing in foreign exchange. (1) Except with the previous permission of the Reserve Bank, no person other than an authorized dealer shall in India, and no person resident in India other than an authorized dealer shall outside India purchase or otherwise acquire or borrow from, or sell, or otherwise transfer or lend to or exchange with, any person not being an authorized dealer, any foreign exchange : Provided that nothing in this sub-section shall apply to any purchase or sale of foreign currency effected in India between any person and a money-changer. Explanation. For the purposes of this sub-section, a person, who deposits foreign exchange with another person or opens an account in foreign exchange with another person, shall be deemed to lend foreign exchange to such other person. 18. Against appellant in appeal No. 533/2004, the allegations are of otherwise acquisition of foreign currency. The words otherwise acquired though wide but positively convey the concept of possession plus capacity of appropriation of the property in foreign cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... beyond reasonable doubt whose burden always remains on Enforcement Directorate (refer Shanti Prasad Jain v. Director of Enforcement Directorate AIR 1962 SC 1764). The concept of proof beyond reasonable doubt is explained by Supreme Court in Castano Pladado Fernandz v. Union of India AIR 1997 SC 707 (sic) as follows : Even where the charge is sought to be proved by preponderance of probabilities, the probabilities have to be such as would not leave any scope for doubt in the minds of a prudent man that the alleged fact may not be true. The findings should be legitimate inference from the evidence on record and should not be unreasonable or perverse or much too speculative [refer State of U.P. v. Buddha 1977 (1) SCC 632]. 21. It is well-settled in law that suspicion, howsoever grave does provide sufficient basis to hold any person guilty. In absence of viable proof of guilt, the appellants are entitled to succeed in these appeals. The impugned order is passed on assumptions, so is required to be quashed and set aside. 22. Therefore, these appeals contain merit so are required to be allowed. The impugned order is passed on wrong assumptions and by putting wrong questions whose answers ..... X X X X Extracts X X X X X X X X Extracts X X X X
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