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DIRECTORATE OF ENFORCEMENT Vs. DELCO PRECITONE JEWELLERS PVT. LTD. & ORS.
March, 31st 2014
*     IN THE HIGH COURT OF DELHI AT NEW DELHI
                               RESERVED ON : 16th JANUARY, 2014
                               DECIDED ON : 24th MARCH, 2014

+                         CRL.A. 295/2012
      DIRECTORATE OF ENFORCEMENT                       ..... Appellant
                          Through :   Mr.Subhash Bansal, Advocate.

                          VERSUS

      DELCO PRECITONE JEWELLERS PVT. LTD. & ORS.
                                      ..... Respondents
                   Through : None.

      CORAM:
      HON'BLE MR. JUSTICE S.P.GARG

S.P.GARG, J.

1.    Crl.A.295/2012 has been preferred under Section 54 of the Foreign

Exchange Regulation Act, 1973 (hereinafter referred to as `FERA') against

the final order dated 09.09.2009 of Appellate Tribunal for Foreign

Exchange, New Delhi in Appeal Nos. 532/2004 to 534/2004. The Appellate

Tribunal allowed appeals of the respondents and quashed the adjudication

order dated 20.01.2004.

CRL.M.A.3304/2012 (delay) in CRL.A. 295/2012
2.    The application has been moved for condonation of delay of 804 days

in filing the appeal.




Crl.A.295/2012                                                 Page 1 of 10
3.    Learned counsel for the appellant (Enforcement Directorate) urged

that the Appellate Tribunal's order dated 09.09.2009 was communicated to

the office of the Enforcement Directorate on 20.10.2009. The appellant

decided to challenge the said order and sent the comments/ instructions to

the previous Standing Counsel. The detailed appeal was prepared and

transmitted to the department for approval of the competent authority. After

the final approval, the appeal was preferred in the High Court. Mr.Atul

Nanda, Central Government Standing Counsel informed the appellant that

the appeal was filed vide Diary No.183108/2010 and was lying under

objection in the High Court Registry. Thereafter, Mr.Atul Nanda was

designated Senior Counsel and the proposed appeal was returned to the

Litigation Section vide letter dated 11.07.2011 for allotting to some other

advocate. On 25.07.2011, Litigation Section (High Court) issued BT in

favour of Mr.Sachin Datta. He took steps for refiling the appeal alongwith

condonation of delay application. Correspondences were exchanged to

ascertain the status of appeal. Vide letter dated 15.12.2011, Mr.Sachin Datta,

Central Government Standing Counsel informed the department regarding

return of the brief along with transmission form to the Litigation Section

with the copies of the appeal, whereby he informed that the High Court




Crl.A.295/2012                                                    Page 2 of 10
Registry refused to accept refiling without proof of original date of filing by

the previous counsel. The appellant department was left with no recourse

and vide letter dated 22.12.2011 a request was made to Mr.Atul Nanda to

submit proof of filing of the appeal and submit the original appeals received

under objection. The appellant then approached Litigation Section (High

Court) for appointment of another counsel. Vide letter dated 23.12.2011,

Litigation Section found that the other counsel had also declined to accept

the brief. The delay of 804 days in filing the criminal appeal occurred due to

the reasons enumerated in Annexure B2. There was no intentional delay on

the part of the appellant.

4.    I have considered the submissions of the appellant and have examined

the record. Apparently, the present appeal has been filed after an inordinate

delay of 804 days. Section 35 of FEMA permits the appeal to be filed within

60 days from the date of communication of the decision or order of the

Appellate Tribunal on any question of law arising out of such order. The

proviso authorises High Courts to extend the appeal to be filed within next

60 days, if it is satisfied that the appellant was prevented by sufficient cause

from filing the appeal. Since the impugned order was passed by the

Appellate Tribunal constituted under FEMA, in my view, the provisions of







Crl.A.295/2012                                                      Page 3 of 10
Section 35 of the FEMA are attracted and the period of limitation for filing

the appeal cannot be extended beyond 120 days.

5.    In `Thirumalai Chemicals Limited vs. Union of India (UOI) & ors.',

2011 (6) SCC 739, the Supreme Court held :

       "14. Substantive law refers to body of rules that creates,
       defines and regulates rights and liabilities. Right conferred
       on a party to prefer an appeal against an order is a
       substantive right conferred by a statute which remains
       unaffected by subsequent changes in law, unless modified
       expressly or by necessary implication. Procedural law
       establishes a mechanism for determining those rights and
       liabilities and a machinery for enforcing them. Right of
       appeal being a substantive right always acts prospectively.
       It is trite law that every statute prospective unless it is
       expressly or by necessary implication made to have
       retrospective operation. Right of appeal may be a
       substantive right but the procedure for filing the appeal
       including the period of limitation cannot be called a
       substantive right, and aggrieved person cannot claim any
       vested right claiming that he should be governed by the old
       provision pertaining to period of limitation. Procedural law
       is retrospective meaning thereby that it will apply even to
       acts or transactions under the repealed Act.
       15. Law on the subject has also been elaborately dealt with
       by this Court in various decisions and reference may be
       made to few of those decisions. This Court in Garikapati
       Veeraya v. N. Subbiah Choudhry and Ors. AIR 1957 SC
       540, New India Insurance Company Limited v. Smt. Shanti
       Mishra (1975) 2 SCC 840, Hitendra Vishnu Thakur and
       Ors. v. State of Maharashtra and Ors. (1994) 4 SCC 602;
       Maharaja Chintamani Saran Nath Shahdeo v. State of Bihar
       and Ors. (1999) 8 SCC 16; Shyam Sundar and Ors. v. Ram
       Kumar and Anr. (2001) 8 SCC 24, has elaborately




Crl.A.295/2012                                                   Page 4 of 10
       discussed the scope and ambit of an amending legislation
       and its retrospectivity and held that every litigant has a
       vested right in substantive law but no such right exists in
       procedural law. This Court has held the law relating to
       forum and limitation is procedural in nature whereas law
       relating to right of appeal even though remedial is
       substantive in nature.
       17. Right of appeal conferred under Section 19(1) of FEMA
       is therefore a substantive right. The procedure for filing an
       appeal under Sub-section (2) of Section 19 as also the
       proviso to Sub-section (2) of Section 19 conferring power
       on the Tribunal to condone delay in filing the appeal if
       sufficient cause is shown, are procedural rights."


6.    It further held :

       "19. Law of limitation is generally regarded as procedural
       and its object is not to create any right but to prescribe
       periods within which legal proceedings be instituted for
       enforcement of rights which exist under substantive law. On
       expiry of the period of limitation, the right to sue comes to
       an end and if a particular right of action had become time
       barred under the earlier statute of limitation the right is not
       revived by the provision of the latest statute. Statutes of
       limitation are thus retrospective insofar as they apply to all
       legal proceedings brought after their operation for
       enforcing cause of action accrued earlier, but they are
       prospective in the sense that neither have the effect of
       reviving the right of action which is already barred on the
       date of their coming into operation, nor do they have effect
       of extinguishing a right of action subsisting on that date.
       Bennion on Statutory Interpretation 5th Edn.(2008) Page
       321 while dealing with retrospective operation of
       procedural provisions has stated that provisions laying
       down limitation periods fall into a special category and
       opined that although prima facie procedural, they are
       capable of effectively depriving persons of accrued rights



Crl.A.295/2012                                                     Page 5 of 10
       and therefore they need be approached with caution.
       25. The appellate Board under FERA, it may be noted stood
       dissolved and ceased to function when FEMA was enacted.
       Therefore, any appeal against the order of the adjudicating
       officer made under FERA, after FEMA came into force, had
       to be filed before the Appellate Tribunal constituted under
       FEMA and not to the Appellate Board under FERA. Section
       52 of FERA stipulates the limitation for an appeal against
       the orders of the adjudicating officer to the Appellate
       Board. It provides the period of limitation as 45 days but the
       Board may entertain an appeal after the expiry of 45 days
       but not beyond 90 days. Under FEMA, an appeal lies to the
       appellate tribunal constituted under that Act and Section
       19(2) provides that every appeal shall be filed within 45
       days from the date on which a copy of the order of the
       adjudicating authority is received. The appellate is however
       empowered to entertain appeals filed after the expiry of 45
       days if it is satisfied that there was sufficient cause for the
       delay in filing the appeal. Though both Section 52(2) of
       FERA and Section 19(2) of FEMA provide a limitation of 45
       days and also give the discretion to the appellate authority
       to entertain an appeal after the expiry of 45 days, if the
       Appellant was prevented by sufficient cause from filing an
       appeal in time, the appellate authority under FERA could
       not condone the delay beyond 45 days whereas under
       FEMA, if the sufficient cause is made out, the delay can be
       condoned without any limit. The question we have already
       pointed out is whether Section 52(2) of FERA or Section
       19(2) of FEMA will govern the appeal. As noticed above,
       any provision relating to limitation is always regarded as
       procedural and in the absence of any provision to the
       contrary, the law in force on the date of the institution of the
       appeal, irrespective of the date of accrual of the cause of
       action for the original order, will govern the period of
       limitation.
       26. Section 52(2) can apply only to an appeal to the
       appellate Board and not to any appellate tribunal.




Crl.A.295/2012                                                      Page 6 of 10
       Therefore, irrespective of the fact that the adjudicating
       officer had passed the orders with reference to the violation
       of the provisions of FERA, as the appeal against such order
       was to the appellate tribunal constituted under FEMA,
       necessarily Section 19(2) of FEMA alone will apply and it is
       not possible to import the provisions of Section 52(2) of
       FERA. As we are not concerned with the appeals to
       Appellate Board, but appeals to the Appellate Tribunal,
       limitation being a matter of procedure, only that law that is
       applicable at the time of filing the appeal, would apply.
       Therefore, Section 19(2) of FEMA and not Section 52(2) of
       FERA will apply. As noticed above, under Section 19(2) ,
       there is no ceiling in regard to the period of delay that could
       be condoned by the appellate tribunal. If sufficient cause is
       made out, delay beyond 45 days can also be condoned. The
       tribunal and the High Court misdirected themselves in
       assuming that the period of limitation was governed by
       Section 52(2) of FERA.
       27. We have already indicated that Clause (b) of Sub-
       section (5) of Section 49 refers to appeal preferred and
       pending before the Appellate Board under FERA at the time
       of repeal. The said clause does not specifically refer to
       appeals preferred against adjudication orders passed under
       FEMA with reference to causes of action which arose under
       FERA. We have already noticed the right of appeal under
       FEMA has already been saved in respect of cause of action
       which arose under FERA however subject to the proviso to
       Sub-section (2) of Section 19 , in the case of belated
       appeals.
       28. Above discussion will clearly demonstrate that Section
       49 of FEMA does not seek to withdraw or take away the
       vested right of appeal in cases where proceedings were
       initiated prior to repeal of FERA on 01.06.2000 or after. On
       a combined reading of Section 49 of FEMA and Section 6 of
       General Clauses Act, it is clear that the procedure
       prescribed by FEMA only would be applicable in respect of
       an appeal filed under FEMA though cause of action arose






Crl.A.295/2012                                                     Page 7 of 10
       under FERA. In fact, the time limit prescribed under FERA
       was taken away under the proviso to Sub-section (2) of
       Section 19 and the Tribunal has been conferred with wide
       powers to condone delay if the appeal is not filed within
       forty-five days prescribed, provided sufficient cause is
       shown. Therefore, the findings rendered by the Tribunal as
       well as the High Court that the Tribunal does not have
       jurisdiction to condone the delay beyond the date prescribed
       under FERA is not a correct understanding of the law on
       the subject."

7.    In `Union of India vs. Ashok J.Ramsinghani', 2011 (4) ALLMR 45,

the Bombay High Court held :

       "16. We find it difficult to accept the above contentions. The
       legislature while repealing FERA and replacing it with
       FEMA has expressly dissolved the first appellate authority,
       namely the Appellate Board. Thus, on commencement of
       FEMA, the first appellate forum prescribed under FERA
       namely, the Appellate Board is expressly abolished. As a
       result, after commencement of FEMA, appeals against
       adjudication orders passed under FERA had to be filed
       before the appellate authorities under FEMA, namely
       Special Director (Appeals) / Appellate Tribunal, as the case
       may be. The legislature further provides under Section
       49(5)(b) of FEMA that appeals pending before the Appellate
       Board on the date of commencement of FEMA shall be
       transferred to the Appellate Tribunal constituted under
       FEMA. Thus, on commencement of FEMA, appeal against
       the adjudication order passed under FERA would be
       maintainable before the appellate authorities constituted
       under FEMA within the period of limitation prescribed
       under FEMA. In other words, appeals against adjudication
       orders passed under FERA or FEMA after the
       commencement of FEMA, have to be filed before the
       appellate authorities constituted under FEMA within the
       period of limitation prescribed for filing appeals before the



Crl.A.295/2012                                                    Page 8 of 10
           appellate authorities constituted under FEMA."

8.     Undoubtedly, Section 54 FERA permits an appeal to be filed to the

High Court within 60 days. The proviso clearly prescribes that the High

Court shall not entertain any appeal under Section 54 if it is filed after the

expiry of 60 days of the date of communication of the decision or order of

Appellate Tribunal unless the High Court is satisfied that the appellant was

prevented by sufficient cause from filing the appeal in time. Even if

provisions of Section 54 are taken into consideration, there is no sufficient

ground made out by the appellant to file the appeal after an inordinate delay

of 804 days. The delay has not been explained. The reasons given by the

appellant in Annexure `B' for delay in filing the appeal do not constitute

sufficient cause. Rather it reveals that there was inaction and negligence on

the part of the various officers. No sincere efforts were made to pursue the

appeal even after objections were raised. No attempt was made for long

seven months to rectify them and refile the appeal. There was slackness on

the part of the appellant to take remedial steps. Application for condonation

of delay cannot be allowed as a matter of routine as vested right accrues in

favour of the opposite party and benefit of such right cannot be disturbed

lightly.




Crl.A.295/2012                                                    Page 9 of 10
9.    In `Directorate of Enforcement vs. Renu Vij', (Crl.A.No.1231/2011)

decided on 30.09.2011 and `Directorate of Enforcement vs. Harmit Singh &

Anr.', (Crl.A.No. 276/2012) decided on February 28, 2013, this Court in

similar circumstances declined to condone the delay of 507 days & 832

days, respectively, in filing the appeals from the date of final order.

10.   Negligence of the appellant to pursue the matter is writ large as it

failed to take steps to serve the respondents. The appellant did not take any

steps on 30.10.2012, 27.02.2013, 13.08.2013 & 29.10.2013. It failed to

furnish the fresh address of the respondents and to place on record the

amended memo of parties.

11.   In view of the aforestated reasons, I find no merit in the application of

the appellant seeking condonation of delay in filing the appeal. Accordingly,

the application for condonation of delay is dismissed.

CRL.A. 295/2012 & CRL.M.A.3303/2012 (Stay)

12.   In view of the order passed in Crl.M.A.3304/2012, the appeal is

dismissed. Pending application also stands disposed of being infructuous.



                                                      (S.P.GARG)
                                                        JUDGE
MARCH 24, 2014/tr




Crl.A.295/2012                                                     Page 10 of 10

 
 
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