The High Court allowed a writ petition challenging a penalty under FERA. Noting the appeal remedy was time-barred due to the 2004 order date, the Court expunged observations on professional misconduct and reduced the penalty from Rs.3 lakhs to Rs.1.5 lakhs.
Observations in paragraph 81 expunged and penalty reduced to Rs.1,50,000.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED :25.09.2019
CORAM
THE HON'BLE MR.JUSTICE V.BHARATHIDASAN
W.P.No.27838 of 2004
and WPMP.No.33853 of 2004
R.Venkatesh ... Petitioner
vs. The Deputy Director Adjudicating Authority Directorate of Enforcement Shastri Bhavan, 3rd Floor, 3rd Block No.26, Haddows Road Chennai – 600 006 ... Respondent
PRAYER: Writ Petition filed under Article 226 of the Constitution of India praying for issuance of a Writ of Certiorari calling for the records relating to the order in proceedings No.DD/MAS/73/2004 (VS) dated 30.07.2004 on the file of the Deputy Director, Directorate of Enforcement (Foreign Exchange Management) Government of India, Shastri Bhavan, Chennai- 600 006 and quash the same insofar as the petitioner is concerned.
For Petitioner : Mr.K.Sugumar For Respondent : Mr.N.Ramesh Special Government Pleader
ORDER
This writ petition has been filed challenging the order passed by the respondent/Adjudicating Authority imposing a penalty of Rs.3,00,000/- (Rupees Three Lakhs only) on the petitioner for contravention of Section 8 r/w. Section 64(2) of the Foreign Exchange Regulation Act, 1973 (hereinafter be referred to as “FERA” for brevity).
petitioner's clients have committed some violation, proceedings have been initiated against the petitioner and others under the provisions of FERA. After enquiry, Adjudicating Authority found that the petitioner guilty of above offence, holding that, being a Chartered Accountant by profession, he cannot claim that he misunderstood the provisions of the Act, and hence, imposed a penalty of Rs.3,00,000/- on the petitioner. Now challenging the same, the present writ petition has been filed.
'81. The noticees, being Chartered Accountants by profession cannot be said to have not understood the provisions of the Act 41 of 1991 and particularly the purpose for which it was enacted by the Parliament. Their contention that they had acted in good faith to help their clients cannot be accepted as they had indulged in purchasing foreign currencies from blackmarket through brokers and mislead their clients.'
The above said observation could have some bearing on the professional conduct of the petitioner and it may go against him. In the above circumstances and in the interests of justice, I am inclined to expunge the observation made against the petitioner in paragraph 81 of the impugned order. So far as the penalty is concerned, considering the fact that the petitioner only said to have given some professional advise, which ultimately ended in violation of provisions of the Act, and the petitioner is not directly involved in any offence, hence I am inclined to modify the penalty imposed on the petitioner to Rs.1,50,000/- (Rupees One Lakh Fifty Thousand only).
In the result, this writ petition is allowed to the extent indicated above. No costs. Consequently, the connected miscellaneous petition is closed. Sd/Assistant Registrar (CS-VII) //True Copy// gpa Sub Assistant Registrar To
The Deputy Director Adjudicating Authority Directorate of Enforcement Shastri Bhavan, 3rd Floor, 3rd Block No.26, Haddows Road, Chennai – 600 006
+3 ccs to Mr.K.Sukumaran, Advocate, S.R.No.82514 +1 cc to Mr.N.Ramesh, Advocate, S.R.No.82527
W.P.No.27838 of 2004 and WPMP.No.33853 of 2004 EV(CO) SSM(30/09/2019).
3 issues framed by the court
Whether a writ petition challenging an Adjudicating Authority order under FERA is maintainable when the appeal remedy under Section 54 is Time-barred.
Whether the observation in the impugned order regarding professional misconduct should be expunged in the interests of justice.
Whether the penalty imposed on the petitioner should be modified given his indirect role in the violation.
1 provisions across 1 enactments
R.Venkatesh
The Deputy Director Adjudicating Authority Directorate of Enforcement
V. Bharithidasan
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
