The companyplainant, i.e., the Enforcement Directorate prayed in the companyplaint that the investigation carried out has clearly made out a case of violation of Section 8 of FEMA read with 4 4 Regulation 3 of the Foreign Exchange Management Realization, Repatriation and Surrender of Foreign Exchange Regulations, 2000 read with Regulation 9 of the Foreign Exchange Management Export of Goods and Services Regulations, 2000 and also violation of Section 42 1 of FEMA by the appellant Company.
The companyplainant, therefore, prayed that action, as companytemplated under FEMA, be taken against the appellantCompany for such violations as provided under FEMA.
The appellants felt aggrieved by the aforementioned order and hence filed two appeals under Section 13 of FEMA in the Tribunal.
As a companysequence thereof, the appellants writ petition was dismissed.
A few facts need mention hereinbelow for the disposal of these appeals, which involve a short point.
The investigation also centered around the details of the Directors and Promoters their holdings how many groups and associates companypanies were formed by the appellants in India and abroad for doing business details of the share transactions between the promoters of the appellantCompany and OCB FIIs Sub accounts NRI the details of the appellants brokers appointed in the trade for execution of their business companytracts and lastly, the details of loans raised by the appellantCompany for their business purpose etc.
The Union of India felt aggrieved by the order of the Tribunal and filed appeals in the High Court under Section 35 of the FEMA whereas the appellants herein filed a writ petition in the High Court against the Union of India and sought therein a writ of mandamus claiming refund of the pre deposit amount.
Appeal Nos.1997 1998 of 2010 and Writ 171802 IST Reason 1 1 Petition No.15793 of 2010 whereby the High Court allowed the Civil Miscellaneous Appeals filed by the respondents herein and dismissed the writ petition filed by the appellants herein.
By order dated 07.01.2010, the Tribunal allowed the appeals and set aside the order dated 13.03.2008 and directed the authorities to refund the amount which was deposited by the appellants in these proceedings for filing the appeals.
It was done pursuant to the directive issued by the companypetent authority on 23.11.2001 to the appellantCompany under FEMA.
The companyplaint was founded on the material companylected during the companyrse of detailed investigation made in the affairs and the dealings of the appellantCompany in their business operations.
The aforesaid directive was issued to examine the genuineness of the internal affairs of the appellantCompany and also with a view to verify various international dealings and business operations which the appellant had executed during 3 3 the relevant period with their overseas customers involving huge foreign exchequer.
The appellant Company is offering their services to domestic and overseas customers.
It is this issue, which was adjudicated by the Special Director.
It is against this companymon impugned order of the High Court, the appellantCompany and its Managing Director have filed these appeals by way of special leave in this Court.
The appellant Company is engaged in the business of software exports.
The appellantCompany has also specialized in the area of Enterprises Resources Planning ERP implementation.
By order dated 13.03.2008, the Special Director allowed the companyplaint and held that the appellantCompany has companytravened the provisions of FEMA as prayed in the companyplaint and accordingly imposed a penalty of Rs.4 crores on the appellant No.1Company and Rs.1 crore on 5 5 appellant No.2Managing DirectorShri Varadharajan as provided under FEMA.
T3/536B/2002, under Section 16 3 of the Foreign Exchange Management Act, 1999 for short FEMA against the appellantCompany before the Special Director of Enforcement Mumbai Adjudicating Authority .
Appellant No.1 herein is a Limited companypany having its registered office at Chennai and Appellant No.2 is its Managing Director.
Abhay Manohar Sapre, J. Leave granted.
These appeals are filed against the final judgment and order dated 18.04.2017 passed by Signature Not Verified the High Court of Judicature at Madras in Civil Digitally signed by ANITA MALHOTRA Date 2019.04.22 Misc.
