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TMI Blog2024 (10) TMI 397X X X X Extracts X X X X X X X X Extracts X X X X ..... chandra Khedekar, the other Panch witness and the handwriting expert were not examined on oath by the Respondent Directorate as material witnesses. However, we note that the plea to conduct the cross-examination is not dependent on examination on oath of witnesses. It is not on record that the Appellant asked for such cross-examination during the course of the adjudication proceedings. In any case, denial of such cross examination does not appear to have caused prejudice to the interest of the Appellant in view of independent corroborative evidence. Thus we agree with the finding that the Appellant acquired and sold various foreign currencies to various persons resident in India during the period from 09.07.2002 to 24.07.2002 in contravention of the provisions of Section 3(a) of FEMA, 1999. The Appellant has taken the plea to reduce the penalty since he made all out efforts to keep the licensed money changer business M/s Griffin Forex Pvt. Ltd. clean of any illegality which is evident from nothing incriminatory having been recovered from the search of his business premises. We therefore reduce the penalty to Rs. 8,50,000/- on the Appellant which will meet the ends of justice. - M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elied statements have been subsequently retracted. The Ld. Counsel submitted that the Ld. Adjudicating Authority has failed to take into consideration that the Respondent Directorate has omitted to provide any independent corroborative evidences to prove the content of the retracted statements. Further, the Respondent Directorate has been unable to prove the genuineness of the report prepared by the Handwriting expert, and therefore it cannot be said that the seized documents bear the handwriting of the Appellant. The Ld Counsel also submitted that the Respondent Directorate did not examine on oath the Panch witness, that is, Shri Ramchandra Khedekar, or the handwriting expert, that is Government Examiner of Questioned Documents so as to prevent their cross-examination by the Appellant herein. 5. The Ld Counsel for the Appellant further submitted that the Ld Adjudicating Authority has failed to take into consideration that the search conducted at the premises of the Appellant is vitiated from illegality, because the second Panch, Sh Ramchandra Khedekar was not present during the entire search, and the first Panch, Sh Naresh only arrived after forty minutes. Further, the Panch witne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Respondent in the present Appeal proceedings. 10. The Ld Counsel for the Respondent submitted that the impugned order does not suffer any illegality in view of the facts of the case, the recorded statements of the Appellant and the independent corroborative evidence in the form of the documents seized from the residence of the Appellant. Therefore, the Ld Counsel for the Respondent pleaded for the Appeal to be dismissed. 11. We have considered the rival submissions and material on record. We have perused the Impugned Order and observe that the Ld. Adjudicating Authority has considered the recorded statements made by the Appellant along with the corroborative evidence in the form of seized documents describing the nature of the unauthorised transactions. The Ld. Adjudicating Authority has also given due consideration to the report of the handwriting expert for drawing inferences about the role of the Appellant. 12. The Appellant has alleged that Ld Adjudicating Authority has relied on retracted statements which were made under coercion. But there is nothing on record to substantiate the allegation. Moreover, the statements made by the Appellant have details which could have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence collected during such illegal search. The only requirement is that the court or the authority before which such material or evidence seized during the search shown to be illegal is placed has to be cautious and circumspect in dealing with such evidence or material. We observe that the Ld. Adjudicating Authority has duly applied his mind in rejecting the arguments raised by the Appellant in the course of the adjudication proceedings. We note that the Hon'ble Supreme Court in Radhakrishnan v. State of Uttar Pradesh [AIR 1963 SC 822] has also held: So far as the alleged illegality of the search is concerned, it is sufficient to say that even assuming that the search was illegal the seizure of the articles is not vitiated. It may be that where the provisions of ss. 103 and 165, Code of Criminal Procedure, are contravened the search could be resisted by the person whose premises are sought to be searched. It may also be that because of the illegality of the search the Court may be inclined to examine carefully the evidence regarding the seizure. But beyond these two consequences no further consequence ensues. 14. Even if the argument of the Appellant is taken that he retracte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statement was not extorted. It thus boils down that the authority or any court intending to act upon the inculpatory statement as a voluntary one should apply its mind to the retraction and reject the same in writing. It is only on this principle of law, this Court in several decisions has ruled that even in passing a detention order on the basis of an inculpatory statement of a detenu who has violated the provisions of the FERA or the Customs Act, etc. the detaining authority should consider the subsequent retraction and record its opinion before accepting the inculpatory statement lest the order will be vitiated. The Appellant has not furnished any evidence to the contrary so as to disprove the statements recorded under oath under Section 37 of FEMA, 1999. The recorded statements with the independent corroborative evidence in the form of seized documents recovered from the residential premises of the Appellant make him liable for the contravention of the provision of FEMA, 1999 for operating unauthorised business of selling/buying foreign exchange without the general/special permission of the RBI. 16. The plea taken by the Appellant that cross-examination was denied since Shri R ..... 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