9911796707
TMI Blog2024 (9) TMI 1033X X X X Extracts X X X X X X X X Extracts X X X X ..... s wrongly seized and ordered to be confiscated. Coming to the various foreign currency notes found in the premises of M/s Duggal Forex Pvt Ltd. and not tallying with the record, appellant has stated that the said amount is duly accounted for and produced the record in support of his contention (as referred by him in para no. 3 above), which reflects that there is no contravention on the part of M/s Duggal Forex Pvt Ltd. Perusal of the impugned order reflects that the Adjudicating Authority has not considered the said record and is silent on this aspect. Therefore, on the basis of record submitted by M/s Duggal Forex Pvt Ltd., the said company has not committed any contravention, as there is no irregularity in the account of the said company. Now, coming to Sumesh Duggal, the evidence on record clearly reflects that he used to sell US $ on premium rate to the officials/officers of Nigerian High Commission. In sequel to my findings in the preceding para, the appeal filed by M/s Duggal Forex Pvt Ltd is hereby allowed and the appeal filed by Sumesh Duggal is hereby dismissed. The Indian and foreign currency seized from the premises of M/s Duggal Forex Pvt. Ltd. is hereby directed to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cy was withdrawn in installments from the account of Embassy at Bank of Tokyo, Parliament Street, New Delhi and the money was converted/purchased from local market @ Rs.42 per dollar; (v) The cash Indian currency was withdrawn from Defence Section Bank Account No. 11790 maintained with Bank of Tokyo, Mitsubshi UFJ Ltd., Parliament Street Branch, New Delhi from 25.04.2007 and the same money was converted into US dollars in cash in open market (vi) He had joined recently in India, therefore, at that time he was not aware about the rules regulations of RBI as regard to conversion of rupees into foreign currency. On the receipt of information from the Income Tax Department, New Delhi, the officers of Directorate of Enforcement recorded the statement of said Captain G.A. OJEDOKUN under Section 37 of FEMA, 1999 on the same day and on 06.07.2007 wherein he stated inter-alia as under: - (i) He was a Nigerian National and holding Diplomatic Passport No. D-0003537 issued at Nigeria on 15.11.2006; (ii) He came to India on 23.04.2007 and joined Nigerian High Commission at Delhi as Defence Advisor to Government of Nigeria (iii) On 21.05.2007 the officers of Income Tax Department, searched his b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isburse the salaries and allowances vouchers according to the directions given by the Defence Adviser of Nigerian High Commission during the period from 25.04.2007 to 21.05.2007 on the order of Mr. Ojedokun, Defence Adviser, he personally went to Bank of Tokyo, Parliament Street Branch, New Delhi and withdraw an amount of Rs.93 million,the money was withdrawn for purchase of building by Mr. Ojedokun, (however, which statement was denied by the other officer, Mr. Joseph who was also present at the time of recording the statement). He was using the mobile number 98105-97843, since last two years; Capt. G.A. Ojedokun had stated that Shri Lawrence, MA Finance High Commission at New Delhi was also aware about the purchase of US $ in black market. The call details of mobile numbers of 9971491598 of Mr. Ojedokun and that of number 9810597843 of Mr. Lawrence were obtained from the mobile operators. Analysis of call details indicated that Mr. Lawrence was in touch with Shri Sumesh Duggal of M/s Duggal Forex (P) Ltd., INA (Mobile No. 9811964693) and also with one Shri Vishal Arora of M/s Maharani Tour and Travels, Scindia House, Janpath, New Delhi (telephone No. 6542407). Call details, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y to D.A. (Defence Adviser) called on his phone and asked that he needed 2 million dollars at black market rates. Later-on they purchased 2 million dollars at black market rates from different persons at Janpath, Paharganj, Connaught Place, Nizammuddin area and other areas of Delhi. These facts were told to him by Shri Kumar who was a driver of Shri Lawrence. He further informed that they purchased foreign currency from one Kakaji of Paharganj area, whose numbers were 23584005, 64590475 and 9873136000 and in Nizammuddin area from one Kamal, whose number was 24359702 and from one person namely Shri Vishal of Janpath. Shri Kumar was using mobile number 9811150750, however his other number and the mobile number of Shri Lawrence were feeded /stored in his mobile. Summon was again issued to Shri Sumesh Duggal for personal appearance on 31.05.2007 and he in his statement recorded under section 37 of FEMA, 1999, he stated that after seeing the transcript of his mobile number 9811964693, dated 08.05.2007, 10.5.2007, 11.05.2007, 12.05.2007, 15.05.2007, 16.05.2007, 17.05.2007, 18.05.2007 and 21.05.2007, wherein the phone number 9873136000 of Kakaji of Paharganj and phone numbers 011-24122147 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ember the details. Page No. 38- It was regarding US $ 3000 @ Rs.46.50, however, he did not remember the details. From the foregoing, it is accomplished that Shri Sumesh Duggal has made following illegal transactions/ dealings in foreign exchange. S. No. Amount Supported documents/statements Page No. of seized documents 1. US $ 80,000 (inclusive of US $ 70000 given to Sh. Rajinder Singh Duggal @ Kakaji+US $ 10000 given/sold to Mr. Lawrence Ajayi). Statements dated 30.05.2007, 01.05.2007 and 05.06.2007 --- 2. US $ 1000 US $6500, US $1000 and US $ 2500 (TC) Statement dated 12.09.2007 Page No. 1 3. US $ 1300, EURO 1670 and US $ 5000 Statement dated 12.09.2007 Page No. 4 4. US $ 700 Statement dated 12.09.2007 Page No. 4 5. US $ 15000 Statement dated 12.09.2007 Page No. 34 6. 4500 AUS $ 13000 Statement dated 12.09.2007 Page No. 34A 7. US $ 3000 Statement dated 12.09.2007 Page No. 38 8. US $ 7629 (13745-6116) Euro 3000(3690-690), AUS $ 1525 (1625-100), Sing $ 1000 (2650-1650) Statement dated 30.05.2007 ---- To summarise, Shri Sumesh Duggal, Director of M/s Duggal Forex (P) Ltd., holding FFMC license issued by RBI has made illegal transaction of sale/purchase of foreign exchange US $ 12112 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RBI and dealt in foreign exchange by way of purchasing US $ 22,34,826 @ Rs.42 per dollar from person in New Delhi, not being an authorized person in the aforesaid manner and contravened the provisions of Section 3 (a) and Section 4 of FEMA, 1999, however, no charges are being proposed in this complaint for insurance of Show Cause Notice as keeping in view Ministry of External Affairs orders regarding Diplomatic Missions and Diplomats enjoy immunity from criminal and administrative jurisdiction of the receiving state as per Article 36(1)(a) (b) of the Vienna Convention Diplomatic Relations, 1961 against Captain G.A. OJEDOKUN and Sh. Lawrence Ajayi. S. No. Name of the person/concerns Charges Respective contravention of the provisions FEMA, 1999 1. Sh. Sumesh Duggal For illegal dealings in foreign exchange by way of acquisition/purchase/sale and transfer of foreign exchange of USD 80,000 Section 3(1) (a) and Section 4 of FEMA, 1999 2. M/s Duggal Forex (P) Ltd. FFMC and its Director Shri Sumesh Duggal For illegal dealings in foreign exchange by way of acquisition/purchase/sale and transfer of foreign exchange of US $ 80,000 (Cash)+US $ 33500(Cash)+ US $ 7629 (Cash), US $ 2500(TC), UK 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2007 which resulted into the recovery and seizure of Rs. 11 lacs and foreign currency worth Rs. 11 lacs along with incriminating documents pertaining to sale/purchase of foreign currency from different persons at black market rates. Shri Sumesh Duggal in his statement dated 30.05.2007 had admitted that he has not fulfilled all the conditions of RBI, as he was not maintaining the proper records and sometimes, he purchased and sold foreign exchange on black market rates. Sometimes one Shri Kumar, a driver in the Nigerian High Commission came to his shop and delivered him the dollars and took Indian currency from him. Mr. Lawrence, Secretary to D.A. (Defence Advisor) purchased foreign currency from one Kakaji of Paharganj area whose numbers were 23584005, 64590475 and 9873136000 and in Nizammuddin area from one Kamal whose number was 24359702 and one person namely Shri Vishal of Janpath. He was regularly in touch with Kakaji of Paharganj, Nigerian High Commission and one Sh. Rajesh of M/s Weldon Forex and he had sold USD 7000 to Sh. Kakaji. He reiterated his statement dated 12.09.2007 and explained the seized documents as illegal transaction of foreign exchange. In reply to the SCN, n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatements of the persons stated in Paragraph 44 of the reply dated 04.12.2014 to the SCN and as such prevented the appellant to defend the matter and file a purposeful and detailed reply. The Adjudicating Officer even failed to provide to the appellant, the documents relevant to the matter, in total disregard to the rules of natural justice. He argued that the Adjudicating Officer has not given any findings on the submissions made by the appellant in his replies to the SCN. He contended that the Adjudicating Officer failed to appreciate that the seized Indian currency is duly accounted for and withdrawn from the Bank on the day of search itself i.e. 30.05.2007. In support of his contention, he pointed out his representation/letter dated 14.06.2007 Annexure-D and 26.03.2008 Annexure-E, along with the documents annexed therewith. He pointed out that statement of account of M/s Duggal Forex Pvt Ltd. at page 79 and 141 of the appeal paperbook reflects that sum of Rs. 5 lakh was withdrawn vide cheque no. 0343745 and sum of Rs. 8 lakh was withdrawn vide cheque no. 0343746, both dated 30.05.2007. The cash of Rs. 11 lakh seized by respondent ED was out of the said cash withdrawn from the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns. The said sections are not of contravening nature and the Adjudicating Officer has utterly failed to state in its order as to what procedure the appellant has failed to follow. Without stating in the order about the procedural lapse committed, the Adjudicating Officer could not have imposed any penalty. He submitted that the Adjudicating Officer has ordered confiscation of the currencies before coming to the conclusion that any contravention has been made out. He pointed out that the restrictions of dealing in foreign exchange are stated in Section 3 of FEMA 1999 and no charge has been found against the appellant under the said Section. He stressed that the adjudication proceedings were held without following the requirements of Rule 4(2) of the Foreign Exchange Management (Adjudicating proceedings and Appeal) Rules, 2000. He pointed out that in the adjudication order, the Adjudicating Officer has no-where held the appellant guilty of any contravention. Prayer is accordingly made to allow the present appeals and thereby set aside the impugned order and release the Indian and foreign currency amount wrongly seized by the respondent ED. 4. On the other hand, Ld. Counsel for the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 11,00,000/- is concerned, the same is duly explained by the appellants by way of tendering the statement of account of M/s Duggal Forex Pvt Ltd. which shows drawal of Rs. 5,00,000/- by way of cheque no. 343741 for sum of Rs. 8,00,000/- by way of cheque no. 343746. The sum of Rs. 11,00,000/- is stated to be out of the said drawn amount of Rs. 13,00,000/-. Accordingly, the said cash of Rs. 11,00,000/- is not an unaccounted money in any manner and is wrongly seized and ordered to be confiscated. Now, coming to the various foreign currency notes found in the premises of M/s Duggal Forex Pvt Ltd. and not tallying with the record, appellant has stated that the said amount is duly accounted for and produced the record in support of his contention (as referred by him in para no. 3 above), which reflects that there is no contravention on the part of M/s Duggal Forex Pvt Ltd. However, perusal of the impugned order reflects that the Adjudicating Authority has not considered the said record and is silent on this aspect. Therefore, on the basis of record submitted by M/s Duggal Forex Pvt Ltd., the said company has not committed any contravention, as there is no irregularity in the account of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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