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2011 Supreme(Bom) 528
2011(4) ALLMR 45
High Court of Judicature at Bombay
THE HONOURABLE MR. JUSTICE J.P. DEVADHAR & THE HONOURABLE MR. JUSTICE A.A. SAYED
Union of India, through the Directorate of Enforcement
Versus
Ashok J. Ramsinghani
CIVIL APPLICATION NO.176 OF 2010 IN FERA APPEAL (ST) NO.27028 OF 2010
Decided on: 04-05-2011
For the Applicant:D.J. Khambatta, Additional Solicitor General with Rui Rodriques, Y.S. Bhate & Ashish Agarwal i/b. M.S. Bharadwaj, Advocates.
For the Respondent:V. Shridharan, Advocate i/b. PDS Legal, Advocates.
Headnote:Foreign Exchange Management Act, 1999 - Section 35-Appeal-Filed against order, imposing penalty belatedly-Con-donation of delay-Appeal filed against order of appellate Tribunal to be treated an Appeal under Section 35 of FEMA-Appeal beyond time by 291 days-High Court cannot condone delay of 291 days in filing appeal-High Court, under Section 35 of Act can condone delay not beyond 60 days.-The appeal filed by the applicant against the decision/order of the Appellate Tribunal dated 18.8.2009 being an appeal filed under Section 35 of FEMA would be subject to the limitation prescribed thereunder. Under Section 35 of FEMA, the Court can condone the delay, not beyond 60 days. In the present case, the appeal is beyond time by 291 days. Therefore, the Court cannot condone the delay of 291 days in filing the appeal.
Foreign Exchange Regulation Act, 1973 - Section 52-Foreign Exchange Management Act, 1999, Section 19-Appeal-Against order imposing penalty-Appellate Board under FERA abolished on commencement of FEMA-Appeal filed before Appellate Tribunal liable to be treated as an appeal under Section 19 of FEMA and not an appeal under Section 52 of FERA.-Admittedly, the Appellate Board stood dissolved on commencement of FEMA and, hence there was no question of filing any appeal before the Appellate Board after the commencement of FEMA. Therefore, though the respondent had stated that the appeal has been filed under Section 52 of FERA, it must be held that the appeal filed by the respondent before the Appellate Tribunal was liable to be treated to have been filed under Section 19 of FEMA and not under Section 52 of FERA.
Foreign Exchange Regulation Act, 1973 - Section 52-Foreign Exchange Management Act, 1999, Section 49(5)(c)-Appeal-Filed before High Court-Against order, imposing penalty, passed by Appellate Authority-Not against decision of Appellate Board-Appeal cannot be said to have been filed under Section 49(5)(c) of FERA-Delay in filings appeal cannot be condoned as per proviso to Section 49(5)(c) of FEMA.-Section 49(5)(c) of FEMA refers to filing of an appeal before the High Court against an order or decision of the Appellate Board under Section 52 of FERA. In the present case, the appeal filed in the High Court is not against the decision or order passed by the Appellate Board. Therefore, it cannot be said that the appeal has been filed before High Court under Section 49(5)(c) of FEMA and consequently there is no question of condoning the delay in filing the appeal as per the proviso to Section 49(5)(c) of FEMA.
Foreign Exchange Regulation Act, 1973 - Sections 52 and 54-Foreign Exchange Management Act, 1999, Section 49(5)(c)-Appeal-Against order in imposing penalty-Jurisdiction of High Court-First Appellate Forum prescribed under FERA i.e. Appellate Board abolished on commencement of FEMA-Appeal against adjudication orders passed under FERA maintainable before Appellate Tribunal under FEMA within period of limitation prescribed under FEMA-Appeal filed against order of Appellate Tribunal cannot be treated as on Appeal filed under Section 54 of FERA-Appeal under Section 54 of FERA maintainable against order of Appellate Board under Section 52 of FERA-No order passed by Appellate Board-No question of filing an appeal under Section 54 of FERA.-Court finds it difficult to accept the above contentions. The Legislature while repealing FERA and replacing it with FEMA has expressly dissolved the first appellate authority, namely the Appellate Board. Thus, on commencement of FEMA, the first appellate forum prescribed under FERA namely, the Appellate Board is expressly abolished. As a result, after commencement of FEMA, appeals against adjudication orders passed under FERA had to be filed before the appellate authorities under FEMA, namely Special Director (Appeals)/Appellate Tribunal, as the case may be. The Legislature further provides under Section 49(5)(b) of FEMA that appeals pending before the Appellate Board on the date of commencement of FEMA shall be transferred to the Appellate Tribunal constituted under FEMA. Thus, on commencement of FEMA, appeal against the adjudication order passed under FERA would be maintainable before the appellate authorities constituted FEMA within the period of limitation prescribed under FEMA. In other words, appeals against adjudication orders passed under FERA or FEMA after the commencement of FEMA, have to be filed before the appellate authorities constituted under FEMA within the period of limitation prescribed for filing appeals before the appellate authorities constituted under FEMA.
Foreign Exchange Regulation Act, 1973 - Section 54-Foreign Exchange Management Act, 1999, Section 49(5)(c)-Appeal-Against order of Appellate Tribunal-Maintainability of-No provision in FEMA to treat order of Appellate Tribunal as order passed by Appellate Board-Appeal not maintainable-As such an appeal cannot be treated as appeal filed under Section 54 of FERA.-The argument of the ASG that the right of second appeal under Section 54 of FERA remains intact even after the commencement of FERA is not acceptable because, Section 54 of FERA provides for appeal to the High Court against the order passed by the Appellate Board and not against the order passed by the Appellate Tribunal. In the present case, the appeal filed in the Court is against the order passed by the Appellate Tribunal and not against the order passed by the Appellate Board. There is no provision under FEMA to treat the order passed by the Appellate Tribunal to be the order passed by the Appellate Board. Therefore, the arguments that the appeal filed against the order of the Appellate Tribunal should be treated as an appeal filed under Section 54 of FERA cannot be accepted, because appeal under Section 54 of FERA was maintainable against a decision or order passed by the Appellate Board under Section 52 of FERA and in the present case, there is no order passed by Appellate Board and consequently there is no question of filing an appeal under Section 54 of FERA.
J.P. DEVEDHAR, J.
1) This Civil Application is filed by the applicant Assistant Director, Enforcement Directorate, Mumbai seeking condonation of 291 days delay in filing the appeal against the order dated 18/8/2009 passed by the Appellate Tribunal for Foreign Exchange in Appeal No.110/08. The Appellate Tribunal by its order dated 18/8/2009 has set aside the penalty of Rs.7 crores imposed by the Special Director, vide order in original dated 28/3/2008, passed under Section 50 of the Foreign Exchange Regulation Act, 1973 (‘FERA’ for short) read with Section 13(1) of the Foreign Exchange Management Act, 1999 (‘FEMA’ for short).
2) The condonation of delay is sought on the ground that there was sufficient cause for not filing the appeal in time and since the appeal is filed under Section 54 of the FERA read with Section 49(5)(c) of FEMA, the High Court is empowered to condone the delay for any period of time subject to showing sufficient cause.
3) In the present case, for the offence allegedly committed under FERA, proceedings were initiated against the respondent after the commencement of FEMA as per Section 49 of FEMA and penalty was imposed under Section 50 of FERA read with Section 13 (1) of FEMA. The question is, whether the first appeal and thereafter the second appeal filed against such penalty order could be said to have been filed before the authorities constituted under FERA or FEMA ?
4) Against the penalty order passed under Section 50 of FERA, an appeal was maintainable before the Foreign Exchange Regulation Appellate Board ('Appellate Board' for short) under Section 52 of FERA. Further appeal against the decision or order of the Appellate Board was maintainable before the High Court under Section 54 of FERA. As per the proviso to Section 54 of FERA, any appeal filed after the expiry of sixty days from the date of communication of the decision or order of the appellate board could be condoned by the High Court provided sufficient cause was shown.
5) FERA was replaced by FEMA with effect from 1/6/2000. Section 49(3) of FEMA empowered the adjudicating officer under FEMA to take notice of any contravention of FERA up to a period of two years from the commencement of FEMA that is upto 31/5/2002. As per section 49(1) of FEMA, the Appellate Board constituted under Section 52(1) of FERA stood dissolved immediately on commencement of FEMA. As a result, appeal against the adjudication order passed by the Special Director had to be filed before the appellate Tribunal constituted under FEMA.
6. Section 49(5) of FEMA is relevant for the purpose of this appeal and the said provision reads thus:-
“49 Repeal and saving:-
(1) to (4) ..........
(5) Notwithstanding such repeal,
(a) anything done or any action taken or purported to have been done or taken including any rule, notification, inspection, order or notice made or issued or any appointment, confirmation or declaration made or any licence, permission, authorization or exemption granted or any document or instrument executed or any direction given under the Act hereby repealed shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provisions of this Act;
(b) any appeal preferred to the Appellate Board under sub-section (2) of section 52 of the repealed Act but not disposed of before the commencement of this Act shall stand transferred to and shall be disposed of by the Appellate Tribunal constituted under this Act;
(c) every appeal from any decision or order of the Appellate Board under sub-section (3) or sub-section (4) of section 52 of the repealed Act shall, if not filed before the commencement of this Act, be filed before the High Court within a period of sixty days of such commencement:
Provided that the High Court may entertain such appeal after the expiry of the said period of sixty days if it is satisfied that the appellant was prevented by sufficient cause from filing the
