A. Joseph vs Tahsildar

P. Sathasivam, J.—Aggrieved by the notice dated 25-11-1994 issued the first respondent calling upon the petitioner to a sum of Rs.

35,000/- towards the penalty amount, due, petitioner has filed the above writ petition to quash the same and issue direction to the respondents 1 to

4 to forbear from taking all further proceedings for the recovery of the penalty of Rs. 35,000/- imposed by the Third respondent in the order dated

25-10-1993 until the appeal filed u/s 52 of the Foreign Exchange Regulation Act, 1973 pending on the file of the fifth respondent is disposed of.

It is seen that the third respondent Deputy Director of Enforcement, Enforcement Directorate, Madras by his order dated 25-10-1993 has

imposed a personal penalty of Rs. 35,000/- against the petitioner for contravention of Section 29(1)(a) and, Section 9(1)(d) read with Section

64(2) of the Foreign Exchange Regulation Act. Aggrieved by the said order, the petitioner filed an appeal before the Foreign Exchange Regulation

Appellate Board - the fifth respondent herein. According to the petitioner, he has also filed an application to dispense with the payment of personal

penalty of Rs. 35,000/- pending disposal of the appeal. Now the grievance of the petitioner is that in the absence of any order being passed in the

petition filed for dispensing with the payment of personal penalty and in view of the fact that the appeal filed by him is pending before the fifth

respondent, the impugned recovery notice issued by the first respondent cannot be sustained.

The claim of the petitioner is liable to be rejected for the following reasons :

It is true that the petitioner has availed statutory remedy of appeal and filed an appeal before the fifth respondent and also filed the petition to

dispense with the payment of personal penalty of Rs. 35,000/-as ordered by the third respondent. It is equally true that the fifth respondent

appellate authority has not passed orders in his petition for dispensing with the payment of the personal penalty,

Learned Additional Central Government Standing Counsel, after taking me through the relevant provisions of the Foreign Exchange Regulation

Act, 1973, would contend that irrespective of the petition filed for dispensation of the penalty amount before the Appellate Board, it would be

open to the concerned authority to recover the penalty amount. He has also relied upon the decision of Janarthanam, J. in the case of K.M.

Mohamed Yousuf Sulaikha Ummal Vs. Asstt. Director, , wherein the learned Judge had an occasion to consider a similar claim. It was contended

before the learned Judge in as much as the appeal had been entertained by the Board, it is to be inferred by way of implication that the prerequisite

of the deposit of the penalty amount has been dispensed with by the Board and by virtue of such dispensation, it is to be construed that there was

no failure on the part of the petitioner to obey the direction of the adjudicating authority, in the sense of, not remitting the penalty amount within the

period specified by it. Rejecting the said contention, the learned Judge has observed as follows :

Such a submission, in the absence of any deeming provision, in the FERA and the Rules cannot at all be acceded to, unless and until there is a

specific order by the Board dispensing with the deposit of the penalty amount. The fact that the appeal had been entertained by assigning a

specified number is not by itself sufficient to indicate even by way of implication that the deposit of the penalty amount had been dispensed with

and the appeal had been taken on file and if at all, in the circumstances it would indicate that a number had been assigned to the appeal for the

purpose of conveniently referring the same in future correspondence.

In the absence of any order dispensing with the deposit of the penalty ''amount'' by the Board, the contravention amounting to an offence u/s

56 of the FERA gets fruitioned by the elapse of forty-five days from the date of receipt of the adjudication order, which in fact happened in this

case, as already adverted to, on 11-11-1986.

I am in respectful agreement with the view expressed by the learned Judge. Apart from this, it is also brought to my notice the decision of a

Division Bench of this court in the case of The Assistant Director, Enforcement Directorate and Another Vs. Hameed Jahuffer alias S.A. Hameed

and Another, , wherein the Division Bench approved the view expressed by Janarthanam, J. in the above referred decision.

In the light of what is stated above, I do not find any merit in the writ petition. Consequently, the same is dismissed. No cost. In view of the

orders passed in the writ petition, W.M.P. No. 31929 of 1994 is dismissed.