Page 99 - ELT_15th August 2020_Vol 373_Part 4

Law

2020 (373) E.L.T. 433 (S.C.)
IN THE SUPREME COURT OF INDIA
Ashok Bhushan and R. Subhash Reddy, JJ.
SHAILENDRA SWARUP
Versus
DEPUTY DIRECTOR, ENFORCEMENT DIRECTORATE
Criminal Appeal No. 2463 of 2014, decided on 27-7-2020
1
Offence by companies - Liability of director - Foreign Exchange - Re-
strictions on dealing - Adjudication - Procedure - Only company secretary re-
sponding to show cause notice issued by Adjudicating Officer to company and
its directors - Written representation by said director during course of personal
hearing to effect that part-time, non-executive director of company and never
in-charge of or even responsible for conduct of business of Company - State-
ment by person in personal hearing even though given in form of written rep-
resentation to be considered by Adjudicating Officer otherwise personal hear-
ing would be empty formality and meaningless - Director’s representation not
contradicting company secretary’s reply - Representation not to have been ig-
nored by erroneous assumption that it was an afterthought - High Court erred
in holding that said material was not filed before Adjudging Authority Appel-
late Tribunal - Nothing on record brought by Department to show that above
plea was incorrect or that director was responsible for conduct of business of
company at relevant time - Director’s plea erroneously refused to be consid-
ered - Liability fastened on director without there being necessary basis for
any such conclusion - No reason given to take contrary view in respect of di-
rector when Adjudicating Officer in another order had held that concerned
director was only part-time non-executive director - Order of Adjudicating Au-
thority imposing penalty on director or by Appellate Tribunal without return-
ing finding on director’s plea, not sustainable - Adjudicating officer errone-
ously imposed penalty on director and it was erroneously affirmed both by
Appellate Tribunal and High Court - Orders and penalty imposed set aside -
Sections 8, 50, 51 and 68 of Foreign Exchange Regulation Act, 1973. [paras 15, 16,
20, 21, 22, 25, 26, 41]
________________________________________________________________________
1 On appeal from Crl. Appeal No. 575 of 2008, decided on 18-11-2009 by Delhi High Court.
EXCISE LAW TIMES  15th August 2020  99