FILE APPEAL WITHIN THE TIME LIMIT OF SECTION 35 OF FEMA-ELSE CONDONATION OF DELAY WILL NOT BE POSSIBLE

FILE APPEAL WITHIN THE TIME LIMIT OF SECTION 35 OF FEMA-ELSE CONDONATION OF DELAY WILL NOT BE POSSIBLE -

KETAN V. PAREKH & ORS v. SPECIALDIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR [SC]

This case relates to Section35 of FEMA Foreign Exchange Management Act, 1999-- There was a delay of 2 years and 8 months' delay in filing appeal before the HighCourt- High Court declined to condone the delay - Whether decision of the High Court is correct- The Supreme Court concurred with the decision of the High Court

The defenedant held the plaintiff was  guilty of infringing the provisions of FEMA and levied penalty on them. TheAppellants contested he penalty before the Appellate Tribunal for Foreign Exchange and requested for cancelling with the need of pre-deposit of the amount of penalty.Appellate Tribunal ordered the Appellants to deposit fifty percent of the amount of penalty with a condition that if they fail to do so, the appeals will be dropped.

The Appellants contested the above verdict, by  filing writ petitions, before the Delhi High Court which set aside the writ petitions. Hence, the Appellants filed appeals under Section 35 of the Foreign Exchange and Management Act before the Bombay High Court. Defendants also filed applications for condonation of  2 years and 8 months' delay.The Division Bench of the Bombay High Court set aside  the applications for condonation of delay by citing that it does not possess authority to consider an appeal filed beyond four months and even though in terms of the autonomy given by the Delhi High Court, the Appellants could have made their appeals within one month, but they did not  do so and, hence,time lag in filing the appeals cannot be excused.

However , Supreme Court of India did not allow the appeal and set aside the appeal on the following elements:

 

Supreme Court was of the view that the applleants plaint did not even mention that they had been prosecuting a relief before a wrong forum before the Delhi High Court with good faith.

Further , the plaintiffs did not mention in their plaint that they lost time in fighting their case before the Delhi High Court.

This demonstrates that the Plaintiffs were trying to have cover under Section 5 of the Limitation Act, which, as emphasised before cannot be taken into account due to the wording  of Section 35 of the FEMA Act and elucidation  of analogues provisions by this Court.

Hence,the Division Bench of the Bombay High Court correcty pointed out  that even though the
dispute pertaining  to jurisdiction of the Delhi High Court to extend time to the plaintiffs to file appeals is highly controversial, the time mentioned  in the order given by the Delhi High Court
cannot be extended.

In view of the above discussion, we hold that the impugned order does not suffer from any legal infirmity.

For any clarification or more information , please contact rvsekar2007@gmail.com or 09848915177.

PROCEDURES FOR APPEALS UNDER FEMA

SPECIAL DIRECTOR OF APPEALS

Any person aggrieved by the order passed by the Deputy director , additional director , special director , Special Director with Deputy Legal Adviser, Director of Enforcement may appeal to Special Director ( Appeals).

Such appeal should be filed within 45 days from the date on which the copy of the order is made by the Adjudicating Authority . Appeal should be verified by the appellant in a proper manner and should accompany with the requisite fees.

The special director (appeals) has power to condone the delay beyond 45 days to file an appeal if he believes that there was enough cause for not filing the appeal within the due date.

The special director after receiving the appeal may give an opportunity to be heard and shall pass such an order thereby confirming or setting aside or modifying the earlier order passed by the authorities against which the present appeal lies. The Special Director (Appeals ) will have the powers analogues to that of civil court which are conferred n the Appellate Tribunal.

Appeals to Appellate Tribunal

If any party aggrieved by the order passed by the Special Director (Appeals ) can apply to  Appellate Tribunal. However , any penalty levied by the enforcing authority or Special Director (Appeals ) should be deposited by the aggrieved party before applying to the Appellate Tribunal. However , an aggrieved party may apply to the Appellate Tribunal to waive the payment penalty and he Appellate Tribunal may dispense with such deposit subject to such conditions as i may deem fit to impose so as to safeguard the realisation of penalty.

Every appeal  to Appellate Tribunal  shall be filed within a period of forty-five days from the date on which a copy of the order made by the Adjudicating Authority or the Special Director (Appeals) is received by the aggrieved person. Appeal should be verified by the appellant in a proper manner and should accompany with the requisite fees. On receipt of an appeal , the Appellate Tribunal may, after giving the parties to the appeal ,an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against.    The Appellate Tribunal shall send a copy of every order made by it to the parties to the appeal and to the concerned Adjudicating Authority or the Special Director (Appeals).

Appeal to High Court Any person aggrieved by any decision or order of the Appellate Tribunal may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Appellate Tribunal to him on any quest on of law arising out of such order: Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days. Explanation.-In this section "High Court" means –

(a) 1.the High Court within the jurisdiction of which the aggrieved party ordinarily resides or carries on business or personally works for gain; and (b) 2.where the Central Government is the aggrieved party, the High Court within the jurisdiction of which the respondent, or in a case where there are more than one respondent, any of the respondents, ordinarily resides or carries on business or personal works for gain. R.V.Seckar   rvsekar2007@gmail.com 919848915177