Case Law Details
Abdul Aziz Ahmed Ansari Vs Union of India (Bombay High Court)
Refund granted for amount seized under FERA as questionable transactions were duly recorded in Income Tax Returns
Conclusion: In present facts of the case, the Hon’ble High Court granted refund to the petitioner along with Interest from year 1988 for the cash which was seized without any corroboration and the said cash was also duly reflected in Income Tax Returns. Therefore, there was no evidence to prove the violation under Foreign Exchange Regulation Act, 1973.
Facts: In present facts of the case, the Writ Petition was filed under Articles 226 and 227 of the Constitution of India challenging a Judgment and Order dated 24 April, 2004 passed by the Appellate Tribunal for Foreign Exchange, in Appeal No.224 of 1995. The Petitioner herein, owned Cloth Stores. On 12th May, 1988, ED raided Petitioner’s Cloth Stores and seized cash from his cash box in Indian currency being an amount of Rs. 1,78,000/- and few other documents. On 5 May, 1989, a Show Cause Notice was issued alleging contravention of Section 9(1)(b) and Section 9(1)(d) of Foreign Exchange Regulation Act, 1973. The said Show Cause Notice stated that the Petitioner had received Rs.45,000/- from persons residing outside India and made payment on behalf of person, who was residing outside India. In the Reply, the allegations were denied, but the Order was passed dated 06.10.1989, thereby holding the Petitioner guilty of the offences under Section 9(1)(b) and Section 9(1)(d) of FERA. Being aggrieved by the Order passed by the Assistant Director of Enforcement, the Petitioner filed an appeal, before FERA Appellate Board. The Appellate Board on 25 February, 1992, after hearing the parties was pleased to allow the appeal of the Petitioner. Then again an SCN was issued under Section 9(1)(b) and 9(1)(d) of FERA to the Petitioner, dated 25 May, 1990. The said notice stated that the Petitioner had received amount of Rs.1,78,000/- from a person in India on behalf of person residing outside India and was supposed to make payment of Rs.2,89,000/- to various persons on instructions of certain individual residing outside India. Again the allegations were denied in Reply, but the petitioner was held guilty under section 9(1)(d).
The Petitioner field Appeal before the Tribunal which was dismissed due to non-attendance of hearing by the Petitioner. In the meanwhile, Appeal of the Petitioner with Income Tax in 1993 was allowed on 16 July, 2004. The Commissioner of Income Tax, held that seized cash of Rs.1,78,000/- is reflected in the cash book and Balance Sheet of the firm M/s. Zaibash Colth Stores.
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