FINAL ORDER

12.12.2024 The present appeal for enhancement of penalty has been filed by Directorate of Enforcement under section 19(1) of the Foreign Exchange Management Act, 1999 against Order No. 03/FERA/2019-20 dated 02.03.2020 passed by the Special Director of Enforcement, Kolkata,vide which penalty of Rs. 50,00,000/- (Fifty Lacs) was imposed on Shri Ilyas Ahmed (herein respondent) for contravention of the provisions of Sections 9(1)(f)(i) of the FERA Act, 1973, during the period 1989 to 05/03/1990 by receiving Rs.19,36,97,703/- and making payments of Rs.9,26,56,633/-.

2. As per the facts of the case, on the basis of specific information pertaining to unauthorized transactions by order or on behalf of persons resident outside India, the officers ofthe Enforcement Directorate, Kolkata intercepted one Shri Ilyas Ahmed alias Guruji alias Masterji, S/o. Md. Thahir of 60, Princep Street (renamed as 4, Anukul Chandra Street), 2nd Floor, Room No. 8, Calcutta -72, in front of the office of M/s. Optronics Services Pvt. Ltd., Suite No. 6, 18th Floor, 33A, Jawaharlal Nehru Road, Calcutta and his personal search was taken under the provisions of Section 34 of the Foreign Regulation Act, 1973 (46 of 1973) (hereinafter referred to as FERA, 1973 (46 of 1973), which resulted in the recovery and seizure of Rs. 2,00,000/- in cash and a bunch of loose sheets from the hand bag and the pocket of the trouser worn by the said Shri Ilyas Ahmed as per details given in the Search List dated 05.03.90.

As a result of follow up action, certain documents and Indian Currency amounting to Rs. 97,000/- were recovered and seized from the residence of Shri Ilyas Ahmed Situated at 60, Princep Street, 2nd Floor, Room No. 8, Kolkata-72 and from the residence of S/Shri M.M. Hussain, S.K. Dawood and S.K. Hassan of 19, Colootola Lane, 1^stFloor, Calcutta, all employees of the said Shri. Ilyas Ahmed, as details given in the Search Lists both dated

05.03.90.

As a result of further follow-up actions at various other places under the provisions of Section 37 of the FERA, 1973(46 of 1973) followed by recording of statements under Section 40 of the FERA, 1973 (46 of 1973), it transpired that the said Shri Ilyas Ahmed @ Guruji @ Masterji, a person resident in India, without any general or special exemption from the Reserve Bank of India, had been receiving payments from various persons other than authorised dealer, by order or on behalf of S/Shri Mac of Hongkong and Rafique of Singapore.

The breakup of payments made by Shri Ilyas Ahmed during the period June, 1989 to 5.3.1990 to various persons as per the arrangement made by Mr. Mac of Hong Kong and Mr. Rafique of Singapore has been given in the Annexure Marked-’A’ to the Show Cause Memorandum which are appended below:

Period Amount paid References to the seized documents

1.11.89 to 5,40,99,790/-(November) + Pages 1, 7 and 8 of document Marked-

30.12.89 3,85,56,843/-(December) seized from the residence of Ilyas Ahmed.

Total 9,26,56,633/-

An Addendum bearing No. T.4/3-C/91(SCN-III) dated

18.12.1991 to the Show Cause Memorandum No.T.4/3-C/91(SCN- III) dated 28.02.1991 was issued whereby certain details were added in continuation of the serial No. in Annexure-’B’ to the said Show Cause Memorandum issued by the S