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APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI

MP-FE-48/DLI/2021 Stay

FPA-FE-27/DLI/2021

Shri Vivek Goyal … Appellant

Versus

The Joint Director,

Directorate of Enforcement, Delhi … Respondent

Advocates/Authorized Representatives who appeared

For the Appellant : Mr. Madhav Khurana, Advocate

Mr. Vasu Gupta, Advocate

For the Respondent : Mr. Girish Tripathi, Advocate

CORAM

SHRI BALESH KUMAR : MEMBER

SHRI RAJESH MALHOTRA : MEMBER

FINAL ORDER

02.07.2026

This Order disposes of the Appeal No. FPA-FE-27/DLI/2021

filed by Shri Vivek Goyal against the Order No. ADJ/01/

FEMA/DLZO-II/2019/JD(NKG)/641 dated 23.07.2019 (Impugned

Order) passed by the Joint Director, Directorate of Enforcement,

Government of India, Delhi. The Ld. Adjudicating Authority (AA)

imposed the penalty of Rs. 10,00,000/- on Shri Vivek Goyal for the

contravention of Section 7 of the Foreign Exchange Management Act,

1999 (FEMA) read with Regulation 16 of Foreign Exchange

Management (Export of Goods and Services) Regulation 2000 in

terms of Section 42 of FEMA.

FPA-FE-27/DLI/2021 Page 1 of 12

2. Ld. Counsel for the Appellant submitted that the Company

M/s Neomagic Semiconductor India Pvt. Ltd. (NSIL) was issued

Show Cause Notice (SCN) No. T-4/07/FEMA/DLZO-II/2018/JD

(NKG) dated 14.11.2018 for its failure to make exports against 10

export advances totaling US $ 11,13,769 equivalent to

Rs.5,01,86,082/- received between 25.04.2006-19.12.2007 from

Neomagic Corporation, USA. The SCN was issued on the basis of

the Complaint dated 29.10.2018 under Section 16 (3) of FEMA. The

SCN and the Complaint had alleged the contravention of Section 7 of

the FEMA read with Regulation 16 of Foreign Exchange Management

(Export of Goods and Services) Regulation 2000. The SCN was also

issued to Shri H P Agarwal, Managing Director, Shri Deep Puar,

Director and Shri Vivek Goyal, Director for the alleged

contraventions in terms of Section 42 of FEMA. Ld. Counsel

submitted that no penalty has been imposed upon the Company

since it has been struck off as confirmed from the website of the

Ministry of Corporate Affairs, the Government of India. He further

stated that penalty of Rs. 20,00,000/- was imposed on Shri H P

Agarwal, and Rs. 10,00,000/- each separately on Shri Vivek Goyal

and Shri Deepraj Singh Puar. Ld. Counsel for the Appellant pleaded

that the Appellant Shri Vivek Goyal is not liable for any penalty in

view of the facts of the case and his role in the Company.

3. Ld. Counsel for the Appellant drew attention to the Impugned

Order. He stated that it is on record that the Appellant was

inducted as the Director in M/s Neomagic Semiconductor India Pvt.

FPA-FE-27/DLI/2021 Page 2 of 12

Ltd. after a few months of his joining the Company as Vice-President

(Engineering), for administrative convenience. He further stated that

he held no shares in M/s Neomagic Semiconductors India Pvt. Ltd.

and was paid salary only. On being asked about who was looking

after day-to-day responsibilities of the company he stated that

’Finance’ and ’Export/Import’ were looked after by Shri H. P.

Agrawal and banking was also taken care of by Sh. Hari Prakash

Agrawal only, though in his (Mr. Agrawal’s) absence, he used to take

care of the same. Ld. Counsel further submitted that the Appellant

was known to the CEO of the parent Company, Shri Prakash C

Agrawal who was his distant relative. Since he was on the verge of

retirement, he (Mr. Prakash C. Agrawal) introduced him to the

Company, which was looking for a reliable and trustworthy person

to manage the Company in India. Thus, he was made responsible for

overall administration. He further said that Sh. Prakash C. Agrawal

was the brother-in-law of his younger brother. About his role and

responsibility in the Company, he stated that he was responsible for

administration, filing of periodical returns to STPI, bank

correspondences and all other documentation of the Company

related to administration.

4. Ld. Counsel for the Appellant submitted that in reply to the

SCN the Appellant made it clear that he was merely an emp