FINAL ORDER

28.11.2024

The instant appeal has been filed against the order of the learned Addl. Director of Enforcement (“adjudicating authority”) dated 30.12.2019 dropping the charges under Section 7 of the Foreign Exchange Management Act, 1999 (FEMA, 1999) read with Regulations 3, 9 and 13 of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000; and Sections 8 and 42(1) of FEMA, 1999 against all the three respondents in this appeal.

Factual Context of the Case

2. The relevant facts of the case are that the appellant Directorate, through its Assistant Director of Enforcement, Panaji Zonal Office, Goa filed a complaint bearing no T-3/26-Goa/2016 dated 25.10.2018 against M/s Minescape Minerals Pvt Ltd. (Respondent no.1), having it office at Minescape, M. G. Road, Panaji, Goa-403001; M/s Dinar Tarcar Resources (India) Pvt Ltd. (Respondent no.2) having its office at Minescape, M.G.Road, Panaji, Goa-403001; and Shri Dinar Tarcar, resident of Altinho, Panaji, Goa-403001 (Respondent no.3) alleging violation of Sections 7 and 8 of FEMA, 1999 read with Regulations 3, 9 and 13 of Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, and Section 42(1) of FEMA, 1999 to the extent of Rs.3,11,68,167/- (by Respondent no.1); Rs.20,00,96,301/- (by Respondent no.2); and Rs. 23,12,64,468/- (by Respondent no. 3), in all, amounting to a total Rs. 46,25,28,936/-

3. The investigation in this case was initiated based on the Show Cause Notice (SCN) bearing no. DRI/MZU/GRU/INV/01/2012 dated 18.08.2015 issued by Directorate of Revenue Intelligence (DRI), Mumbai to M/s Minescape Minerals Pvt. Ltd and M/s Dinar Tarcar Resources (India) Pvt Ltd, Goa (Respondents no. 1 & 2 herein), for evasion of Customs Duty in respect of the export of iron ore to their overseas buyers, viz, M/s Dragon Commodities Ltd, Hong Kong and M/s Orient Express Commodities Ltd, Singapore at undervalued prices. Enquires conducted by DRI revealed that M/s Minescape Minerals Pvt Ltd and M/s Dinar Tarcar Resources (India) Pvt Ltd, in all, had exported nine shipments of iron ore to their related overseas buyers, M/s Dragon Commodities (HK) Ltd, Hong Kong and M/s Orient Express Commodities Pvt. Ltd. Singapore.

4. In the said SCN, it was alleged that both the respondent companies had evaded Customs Duty by suppressing and mis-stating the actual transaction value of the export goods. M/s Dinar Tarcar Resources (India) Pvt Ltd suppressed the actual transaction value in respect of five export consignments and M/s Minescape Minerals Pvt Ltd suppressed the actual transaction value in respect of two export consignments. Based on the aforesaid, investigation in this matter was initiated under the provisions of FEMA, 1999.

5. M/s Dinar Tarcar Resources (India) Pvt. Ltd is a company incorporated in Goa on 26.02.2009 and deals in export of iron ore from the state of Goa. Shri Dinar Purushottam Tarcar and his wife, Smt. Manisha Dinar Tarcar, are the two Directors of M/s Dinar Tarcar Resources (India) Pvt Ltd since its incorporation. M/s Dinar Tarcar Resources (India) Pvt Ltd exported five consignments of iron ore to its related overseas entities, namely, M/s Orient Express Commodities Pvt. Ltd, Singapore and M/s Dragon Commodities Ltd, Hong Kong wherein, it is alleged by the Directorate, that the Indian company has not received the full and correct value of the goods exported. Details of the said export consignments are as follows:

Table No. 1