important point
An adjudicating authority, in absence of any power conferred upon it in this behalf, could not prefer any appeal against the order passed by the Appellate Board.

judgment

S.B. SINHA, J. —

1.A short but an interesting question as to whether a Special Director appointed under the Foreign Exchange Regulation Act, 1973 (for short, the Act) himself can prefer an appeal before the High Court against an order passed by the Foreign Exchange Regulation Appellate Board (for short, the Board) arises for consideration herein.

2.Before embarking upon the said question, we may briefly state the fact of the matter.

Appellant herein was served with a show cause notice by the Enforcement Directorate on 04.07.1991 for alleged contravention of the provisions of Section 9(1)(b), 9(1)(d) and 9(3) of the Act, alleging, inter alia, that during the period June 1989 to July 1990, he caused to remit various payments aggregating to Rs.2,81,73,700/- to India from United Arab Emirates (UAE) through persons other than authorized dealers. Cause was shown thereto by the appellant. The Special Director, however, adjudicated the matter and by an order dated 06.10.1993 imposed a penalty of Rs. 2,50,000/- on the appellant in terms of Section 9(3) of the Act. Penalty was also imposed on one Shri Champalal Singhvi.

3.Aggrieved by and dissatisfied therewith, an appeal was preferred by the appellant before the Board. The Board allowed the said appeal, inter alia, holding :

“12. It would appear from the above discussion that neither in the documents seized from Champalal Singhvi and those seized from the premises of Yousuf Kazia, nor in the statements of Champalal Singhvi and Kazia Brothers, there is any evidence of actual remittance of any amounts from abroad as alleged, even though prima facie that evidence may indicate distribution of amounts in India on the instructions from persons abroad.”

It was further observed :

“In our opinion, in view of the conclusions already made by us that the charge of contravention of section 9(3) cannot be made out on the basis of the facts as assumed by the Department, it is not necessary to consider other grounds on which the adjudication order has been impugned in this appeal. We are of the view that consideration of those grounds would amount to expressing opinion in respect of the evidence which tends to implicate Kazia brothers and Champalal Singhvi and therefore, any pronouncement on those grounds should be avoided if possible.”

4.Respondents herein preferred an appeal thereagainst before the High Court. The Central Government was not impleaded as a party therein. The appellate authority, namely, the Board, however, was impleaded as a party, although it should not have been.

5.Before the High Court, the appellant, inter alia, raised a question in regard to the maintainability of the appeal at the instance of the respondents herein on the premise that it was the Central Government who could prefer an appeal and not the adjudicating authority itself. Reliance, in this behalf, was placed on a decision of the Madras High Court in Director of Enforcement, Madras v. Rama Arangannal and Another,1 [AIR 1981 Madras 80) as well as on a decision of the Punjab & Haryana High Court in Director of Enforcement v. Lal Chand and Another,2 [(1985) 6 ECC 55 : CFC (P&H) 24].

6.Before the High Court, it was furthermore contended that the finding of fact arrived at by the Board cannot be interfered with by the High Court having regard to the scope and purport of Section 54 of the Act. On the first contention, the High Court opined that as the respondent has been appointed under the Act, in terms whereof he was authorized to enforce the provisions thereof, an appeal at its instance would be maintainable, stating :

“A perusal of sub-section (3) of Section 4 of the Foreign Exchange Regulation Act, 1973 per se reveals that unless and until the Central Government has put certain conditions or limitations on the powers of the officers of the Enforcement Directorate, the law authorizes and requires the officers of Enforcement Directorate to exercise powers and to discharge the duties conferred and imposed upon them unde