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Allahabad High Court · body

1997 DIGILAW 1011 (ALL)

Isimdar Ahmad v. Foreign Exchange Regulation Appellate Board

1997-09-02

C.A.RAHIM

body1997
JUDGMENT : C.A. RAHIM, J. 1. This writ petition has been filed to quash the order dated 20.9.1995 passed by the Chairman, Foreign Exchange Regulation Act Appellate Board, to quash the complaint dated 27.8.1993 in Criminal Case No. 257 of 1993 pending in the Court Chief Judicial Magistrate, Allahabad, to quash the ex-parte order passed by the Respondent No. 2 in Adjudication case No. S.D.E. (R) 11/21/1990 and to issue a direction in the nature of mandamus commanding the Respondent No. 1, the Appellate Board, to decide the Appeal No. 16 of 1994 of the Petitioner on merit. 2. On 31.7.1983 the officers of the Enforcement Directorate Foreign Exchange Regulation Act, In short F.E.R.A. searched the residential premises of the Petitioner and seized some incriminating documents showing the Petitioner dealing in making compensatory payments under instructions from one Abdul Jabbar staying at Singapore. The officers interrogated the Petitioner on different dates in 1984. A show-cause notice was issued to him on 2.5.1986, u/s 61(2)(ii) of the F.E.R.A. as to why adjudication proceeding u/s 51 of the Act should not be started against him. On 28.6.1986 the Petitioner sent a reply to that notice denying that the documents seized from his residence did not belong to him. He also denied having made any payment to anybody on behalf of Abdul Jabbar or any other person residing outside India. Adjudication case being No. S.D.E. (R) 11/21/1990 was started and in view of Rule 3 of the Adjudication Proceedings and Appeal Rules, 1974, a notice was issued to the Petitioner by registered post fixing 19.13.1990 for hearing. It is alleged by the Petitioner that he was not present in his house from 20.10.1980 to 31.10.1990. The Petitioner did not receive notice and was not aware of the said proceeding. Respondent No. 2 decided the matter ex-parte on 29.11.1990 on the basis of the statement of the Petitioner dated 28.6.1986. The Petitioner was found guilty as he contravened Section 9(1)(d) of the Act and imposed penalty to the extent of Rs. 75,000 u/s 50 of the Act. 3. A notice intimating the order was despatched by the registered post on 3.12.1990 which was received by the Petitioner on 26.4.1991 asking him to make payment within 45 days. The Petitioner was found guilty as he contravened Section 9(1)(d) of the Act and imposed penalty to the extent of Rs. 75,000 u/s 50 of the Act. 3. A notice intimating the order was despatched by the registered post on 3.12.1990 which was received by the Petitioner on 26.4.1991 asking him to make payment within 45 days. The Petitioner filed a writ petition against that order but it was dismissed on 30.7.1991 as an alternative remedy was available to the Petitioner u/s 52 of the Act. The Petitioner preferred an appeal, being No. 16 of 1994. A memo of appeal was sent by registered post which was received by the appellate board on 11.1.1294. An application supported by affidavit was also filed for condonation of delay. 4. During pendency of the appeal, Respondent No. 4 lodged a complaint case u/s 56 of the Act before the Chief Judicial Magistrate, Allahabad, being No. 3457 of 1986, for contravention of Section 9(1)(d) of the Act, but the Chief Judicial Magistrate, Allahabad, acquitted the Petitioner on 12.12.1991 on the ground that the prosecution failed to establish the guilt against the Petitioner by adducing cogent evidence. An appeal, being Civil Appeal No. 4324 of 1992 was preferred by the Enforcement Directorate before this Court which was dismissed (paragraph 13 of the rejoinder-affidavit). 5. Respondent No. 4 filed a complaint on 27.8.1993 before the Chief Judicial Magistrate, Allahabad, being case No. 257 of 1993 u/s 57 of the Act on the allegation that the Petitioner defaulted in making payment of Rs. 75,000 within the prescribed period, as adjudicated upon, which according to the Petitioner is barred u/s 300, Cr. P.C. and Article 20(2) of the Constitution of India. 6. The learned Counsel Sri K.A. Qayyum, appearing for the Petitioner, has submitted that once Criminal Case No. 3457 of 1986 is decided in favour of the Petitioner and he was acquitted, the subsequent Case No. 257 of 1993 is barred as the Petitioner cannot be tried twice for the same offence. 7. Sri S.P. Malviya, appearing for the Respondents has submitted that there is no bar in conducting two prosecutions, one u/s 56 and another adjudication proceedings u/s 51 of the Act. He has pointed out that F.E.R.A. is a special Act making provision for both prosecution in different forum and for different purpose. The Adjudication Officer is not a Court and accordingly Section 300, Cr. He has pointed out that F.E.R.A. is a special Act making provision for both prosecution in different forum and for different purpose. The Adjudication Officer is not a Court and accordingly Section 300, Cr. P.C. has no application. 8. In A.S.G. Jothimani vs. Deputy Director, (1984) 3 ECC 319 (Mad), it was held that: .........Criminal prosecution u/s 56 of the Act is not dependent upon the outcome of adjudication proceedings. The prosecution u/s 56 of the Act, therefore can be launched when the appeal against the order of adjudication proceeding is pending. 9. The instant case is fully covered by this decision as it is also a case of the Petitioner that a complaint u/s 56 of the F.E.R.A. was filed during pendency of the Appeal against the Adjudication proceeding and hence the plea taken by the learned Counsel that the accused suffered from double jeopardy is not substantiated. 10. A Division Bench of the Gujarat High Court in Mafatlal Damodardas vs. Union of India, (1987) 14 ECC 217, has held that: Inspite of termination of the criminal proceedings in favour of the accused, the departmental proceedings by way of adjudication and penalty could be pursued further by the concerned authorities. The Legislature has contemplated that for alleged contravention of the provisions of the Act, the concerned delinquent can be proceeded against departmentally by way of adjudication and penalty proceedings and can also be criminally prosecuted. These are two independent proceedings and one would not impinge on the other. 11. The contention of the learned Counsel that the complaint case u/s 56 of the Act and u/s 57 of the Act cannot run because both the cases emerge out of the same incident, cannot be accepted in view of the decision of Mafatlal's case (supra) as a complaint case u/s 57 of the Act is nothing but a follow-up action of the Adjudication proceeding held u/s 51 of the Act in which penalty was imposed as per the provision of Section 50 of the Act. 12. In the State of Andhra Pradesh vs. Sree Rama Rao, AIR 1963 SC 1723 , the Supreme Court did not find the statement of the inquiry officer in the departmental proceedings to the effect that the judgment of the Magistrate holding a criminal trial could not always be regarded as binding in a departmental inquiry, to be erroneous. 13. 12. In the State of Andhra Pradesh vs. Sree Rama Rao, AIR 1963 SC 1723 , the Supreme Court did not find the statement of the inquiry officer in the departmental proceedings to the effect that the judgment of the Magistrate holding a criminal trial could not always be regarded as binding in a departmental inquiry, to be erroneous. 13. The Scheme of the Act is to provide punishment as well as to start a parallel proceeding to impose penalty not exceeding five times of the amount involved. Special provision has been made under Sections 71 and 72 of the Act with regard to burden of proof and presumption, relaxing the usual provision provided in the Evidence Act. The Adjudicating proceeding and the case filed in criminal court in respect of the same matter, therefore, is legally permissible as the same is not amounting to double jeopardy under Article 20(2) of the Constitution. The adjudicating authority not being a court, so the finding given by it cannot be construed as one falling within the ambit of Section 300, Cr. P.C. 14. An appeal was preferred u/s 52 of the Act against the order of the Adjudicating Officer, admittedly beyond 90 days with an application of condonation of delay. The appellate authority, Respondent No. 1, was not satisfied and passed an order dated 20.9.1990 stating that the appeal is beyond the period of limitation and asked the Petitioner by issuing a notice why the condonation application filed by the Petitioner shall not be dismissed. A final order was passed dismissing the Appeal on 15.3.1996 when the Petitioner did not appear or show cause on the ground of limitation. By that time this writ petition was filed on 14.2.1996 without waiting for final order. 15. Learned Counsel for the Petitioner submits that when the application for condonation of delay was entertained, it should have been adjudicated upon, when the matter was heard on 29.9.1995 instead the judgment was ordered to be reserved. The application of the Petitioner for condonation of delay should be considered as allowed by implication. A prayer has also been made for issuing a mandamus for deciding the appeal treating the petition for condonation of delay as allowed. The application of the Petitioner for condonation of delay should be considered as allowed by implication. A prayer has also been made for issuing a mandamus for deciding the appeal treating the petition for condonation of delay as allowed. Reliance has been placed on the decision Hindusthan Commercial Bank Ltd. vs. Punnu Sahu (Dead) through Legal Representatives, (1971) 3 SCC 124, wherein it is held that in several decisions the word entertained in Proviso Order XXI, Rule 90, C.P.C. has been interpreted as "adjudicated upon" or "proceed to consider on merit." In that case the application to set aside the sale was filed prior to adding of Clause (b) in Rule 90 of Order XXI, C.P.C. It was contended in that case that the word "entertained" found in the proviso refers to initiation of proceeding and not to the stage when the Court takes up application for consideration. 16. Relying on the said decision the learned Counsel submits that when the judgment was reserved and thereafter asked for filing an application for condonation of delay, the order is bad and also barred under the law. It is true that Respondent No. 1 could have passed final order on that day without issuing another notice but for issuing a second notice, it cannot be said that the Petitioner was prejudiced in any way. The appellate authority probably thought to issue a second show-cause notice before the final adjudication. Moreover, the decision referred in this connection by the learned Counsel for the Petitioner has no application as the interpretation was made in connection with Order XXI, Rule 90 (b), C.P.C. which has no impact in the facts and circumstances of this case. 17. I do not consider that the adjudication proceeding u/s 51 of the F.E.R.A. is bad in law or that the decision of the Appellate Authority has any infirmity since there is a mandatory provision with regard to limitation u/s 52 of the Act. Reassessment of the facts of this case was solicited but it is neither possible nor desirable in writ jurisdiction. So I refrain to do it. The proceeding u/s 57 of the Act is subsequent to the filing of the adjudication proceeding made u/s 51 of the Act and the final order passed u/s 52 of the Act and it may run parallel to the case instituted u/s 56 of the Act. So I refrain to do it. The proceeding u/s 57 of the Act is subsequent to the filing of the adjudication proceeding made u/s 51 of the Act and the final order passed u/s 52 of the Act and it may run parallel to the case instituted u/s 56 of the Act. When Section 56 is confined to inflict punishment for violation of provision of Section 9(1)(d) of the Act, Section 57 has provided punishment for non-payment of penalty imposed by the adjudicating authority u/s 50 of the Act. Both are on different premises. So it is neither barred u/s 300, Cr. P.C. nor is opposed to Article 20(2) of the Constitution of India. 18. The writ petition having devoid of merit, it is dismissed. No cost.