S. RAMAKRISHNA Vs. ENFORCEMENT DIRECTORATE

JUDGEMENT

(1.) INVOKING the jurisdiction of this Court under Clause 10 of the Letters Patent, the Appellant/ Petitioner ('the Appellant') has called in question the warrantableness of the order dated 21 -4 -2010 passed by the learned Single Judge in WP (C) No. 4311/2007.

(2.) THE facts which are imperative to be exposited are that the Special Director, Enforcement Directorate (ED), as pleaded by the Appellant, initiated a proceeding against the Appellant on 22 -8 -2002 under the Adjudication Proceedings and Appeal Rules, 1974 (for short 'the 1974 Rules') and eventually passed the (sic) order on 17 -2 -2005 whereby he imposed a penalty of Rs. 50 lakhs for contravention of Section 18(2) and 18(3) of the Foreign Exchange Regulation Act, 1973 (for short 'the FERA'). Being grieved by the aforesaid order, the Appellant preferred an appeal before the Appellate Tribunal of Foreign Exchange (for short 'the Tribunal') whereby the Tribunal, on 2 -1 -2006, while considering the application for a pre -deposit, passed an order on 7 -2 -2006 requiring the Appellant to furnish an unconditional bank guarantee of Rs. 25 lakhs in favour of the Special Director, ED within 45 days as the condition precedent for hearing of the appeal. The Appellant, as set forth, filed an application for modification of the order relating to pre -deposit which was dismissed and eventually, the appeal was dismissed by the Tribunal on 19 -1 -2007.

(3.) IT was also canvassed that if Rule 3 of the 1974 Rules is scrutinized in proper perspective, it would not remotely convey that there was commencement of proceeding as contemplated under Section 49(3) of the FEMA as there is a reference to Section 51 of the FERA. Before the learned Single Judge, emphasis was laid on the 11th Report of the Standing Committee of Finance (1998 -99) on the Bill preceding FEMA, the minutes of the 32nd sitting of the Standing Committee on Finance held on 9 -12 -1998 and the Rajya Sabha Debates held on 8 -12 -1999 to bolster the contention that the intention of the Legislature was not to permit continuance of the proceedings under the FERA after the cut -off date. Reliance was placed on S.K. Sinha, Chief Enforcement Officer v. Videocon International Ltd. : (2008) 2 SCC 492 :81 SCL 507 and Bachraj Bengani v. A.K. Roy, 2009 IV AD (Delhi) 333.