Page 119 - ELT_1_1st April 2020_Vol 372_Part

2020 ] SUBORNO BOSE v. ENFORCEMENT DIRECTORATE 5

tion 16(3) of the Foreign Exchange Management Act, 1999 (for short, “the FEMA
Act”).
2. A show cause notice, dated 19-5-2004 was issued to the appellant,
stating that the adjudicating authority was satisfied that there was a prima facie
contravention of Section 10(6) of the FEMA Act read with Sections 46 and 47 of
the said Act and paragraphs A-10 and A-11 (Current Account Transaction) of the
Foreign Exchange Manual, 2003-2004 in the complaint filed against the company
named M/s. Zoom Enterprises Limited (for short, “the Company”) of which, the
appellant was the Managing Director. The appellant filed his reply to the said
show cause notice on 10-6-2004, inter alia, contending that the Company had pur-
chased 2 Nos. of Water Cooled Screw Chiller Unit Model and other accessories
for a cost of 374000 FRF from Carrier S.A. of France and Air Handling and Fan
Coil Unit for US$ 35766 from Carrier Corporation, Syracuse, New York. The im-
port was done under Export Promotion Capital Goods (EPCG) Licence under
Open General Licence (OGL). The goods were imported, but kept in warehouse,
as the Company, which at the relevant time was under Mr. Aniruddha Roy
Chowdhury and others, failed to take steps to get the goods released. The appel-
lant took over the project only in July, 2002 and afterwards, he spent nearly 5
crores of rupees for the project work. Due to financial constraints, in February,
2003, a request was made to Tourism Finance Corporation of India Limited
(TFCI) for sanction of a bank guarantee of Rs. 40,00,000/- (Rupees forty lakhs
only) to get the shipment in question cleared from the Customs Department, but
for the reasons beyond the control of the Company and the appellant in particu-
lar, the shipment could not be cleared. A request was made to the Customs au-
thority to help the Company to get the goods cleared, in case the clearing agent is
unable to take necessary steps on their behalf. In the end, a request was made in
the reply to grant more time to get the goods cleared and to submit the Bill of
Entry (Exchange Control Copy) with the authorised dealer.
3. The reply to the show cause notice filed on behalf of the Company
including for the appellant and the submissions made before the adjudicating
authority were duly considered by the adjudicating authority in its Order (Origi-
nal), dated 30-12-2004. The adjudicating authority concluded that the noticee
Company and the appellant had violated the provisions of Section 10(6) of the
FEMA Act read with Sections 46 and 47 of the said Act read with paragraphs A-
10 and A-11 (Current Account Transaction) of the Foreign Exchange Manual,
2003-2004 having found that the goods had arrived in India, but the Company
failed to submit Bill of Entry and did not take delivery of the goods. The import
formalities would have had completed only after submission of Bill of Entry.
Thus, though the goods for which foreign exchange was remitted had reached
the destination of the users, but the same were not released and as such kept in
bonded warehouse. That resulted in contravention warranting issuance of show
cause notice to the Company and the appellant. Resultantly, the adjudicating
authority passed the following order : -

EXCISE LAW TIMES  1st April 2020  167