Kerala High Court
Central Govt. Represented By The ... vs Fr. Alfred James Fernandez on 18 November, 1986
Equivalent citations: AIR1987KER179, 1987(13)ECC248, 1987(31)ELT902(KER), AIR 1987 KERALA 179, (1987) 13 ECC 248, (1987) 31 ELT 902, (1987) 1 CRIMES 579
Bench: T. Kochu Thommen, K.G. Balakrishnan
JUDGMENT Thommen, J.
1. This appeal by the Central Government is brought from the order of the Foreign Exchange Regulation Appellate Board (the "Board") quashing the order of the Additional Director of Enforcement dt. 29-10-1977, whereby a penalty of Rs. 1,18,000/- was imposed upon the respondent in this appeal for the alleged violation of the provisions of Sections 8(1) and 9(1)(f)(i) of the Foreign Exchange Regulation Act, 1973. The main contention of the respondent before the Board was that rules of natural justice were breached by the officer at first instance for the reason that the respondent was not given an opportunity to cross-examine persons who had, pursuant to summons under Section 40, given statements to the department. This contention was accepted by the Board. Accordingly the Board held :
"3. We, therefore, set aside the order of the adjudicating officer and remand the case for fresh disposal after giving the appellant an opportunity to cross-examine the persons whose statements were relied upon by the Department for substantiating the charges."
2. Section 51 of the Act, which deals with the power to adjudicate in respect of the matter provided under Section 50, that is, the imposition of penalty, provides for an enquiry to be conducted in the manner prescribed by rules. The relevant provisions are those which are contained in Rule 3 of the Adjudication Proceedings and Appeal Rules, 1974. That rule says that the person proceeded against in an enquiry under Section 51 has to be heard :
"either personally or through his lawyer or other authorised representative."
The rule thus postulates a personal hearing, which implies a right to appear in person and to adduce evidence. This includes a right to examine and cross-examine witnesses.
3. Sections 39 and 40 are analogous to Sections 107 and 108 of the Customs Act, 1962. Section 39 empowers the concerned officer to conduct investigation or other proceeding, and, in the course of any such investigation or proceeding, to require any person to produce or deliver any document relevant to such investigation or proceeding, or to examine any person acquainted with the facts and circumstances of the case. Section 40 confers on the officer power to summon persons to give evidence and produce documents. While Section 39 gives the concerned officer power to investigate into matters which may ultimately result in any enquiry under Section 51, Section 40 deals with the power to summon persons in connection with the enquiry for giving evidence or making statements and producing documents.
4. In the present case the respondent was informed of the names of persons who had given statements against him. He was given an opportunity to peruse those statements. He was, however, admittedly not given copies of those statements. Admittedly he was not afforded an opportunity to cross-examine the persons who had given the statements, although he had specifically requested for such an opportunity.
5. The Board was impressed by the argument that, in so far as the respondent was not allowed an opportunity to cross-examine the persons who had given statements, the enquiry could not be regarded as a fair enquiry. The order under appeal before it was accordingly set aside by the Board and the matter was remanded for fresh consideration by the concerned officer at first instance after affording the parties a proper opportunity of being heard.
6. Counsel for the appellant submitted that the Board exceeded its jurisdiction in quashing the order and remanding the case. We do not agree. The Board was, in the circumstances of this case, justified in concluding that it would be fair if a fresh opportunity was given to the respondent. The Board was impressed by the respondent's contention that he was not given an effective opportunity to elicit evidence in his defence by cross-examining witnesses who had given statements against him. We see no reason to interfere with that order.
7. Cross-objections have been filed by the respondent contending that it was unfair to him to remand the matter at this distance of time. The respondent's counsel Shri Mathai Paikeday submits that the respondent is now over 80 years of age and he is seriously ill in a hospital. He says that it is unnecessary to remand the case to the officer at first instance as it would cause further delay, and that it would suffice if the Board would consider the matter on the merits with reference to the evidence already on record as well as any other evidence which the parties might wish to let in before the Board. Counsel for the appellant-Government fairly points out that the Board has all the powers of a Civil Court under Section 53 for summoning the witnesses and recording their evidence. He states that the appellant has no objection to the matter being considered by the Board itself on the merits, instead of remanding the same. The submissions at the bar are recorded. In the circumstances we set aside the order of the Board in so far as it has remanded the matter, but in every other respect its order is confirmed. Consequently we direct the Board to afford both the parties a proper opportunity of being heard and adducing fresh evidence, and to dispose of the appeal on the merits.
8. The appellant's counsel submits that the Board will dispose of the appeal within six months from the date of receipt of a copy of this judgment. This submission is also recorded.
9. The appeal is accordingly dismissed. The cross-objections are disposed of as above. No costs.