P.Balasubramaniam Vs Appellate Tribunal for Foreign Exchange (Madras High Court)
Madras High Court held that penalty under section 50 of the Foreign Exchange Regulation Act [FERA] is not applicable since unrealised export proceeds is less than 10%. Accordingly, writ appeals are allowed and order is quashed.
Facts- The Appellant exported consignments of goods to various countries. However, a part of the export proceeds for a sum of Rs.1,09,74,431.20/- on the exports made was not recovered by the said appellant. The Appellant/Exporter had availed the benefit of Duty Drawback under Section 75 of the Customs Act, 1962 read with Customs and Central Excise Duties Drawback Rules, 1971.
Since, a part of the export proceeds was not realized by the Appellants/Exporters, the Appellant has paid back the Duty Drawback to an extent of Rs.5,28,630/- pursuant to a Demand Notice dated 10.04.2003 and Letter dated 07.04.2003 of the Commissioner of Customs, Chennai.
The Appellants/Exporters were issued with Show Cause Notice dated 03.05.2002 whereby they were called upon to show cause as to why adjudication proceedings as is contemplated u/s. 51 of the Foreign Exchange Regulation Act, 1973 read with Sub-Section (3) and Sub-Section (4) to Section 49 of the Foreign Exchange Management Act, 1999.
