1 fera-86.06.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION FERA APPEAL NO. 86 OF 2006 Anil Mahdusudan Vaidya. ... Appellant. V/s. Foreign Exchange Regulation Appellate Board and others. .... Respondents. M.M.Patel for the appellant. G.N.Sharma with Rajendra Kumar for the respondents. CORAM : V.C.DAGA AND R.M.SAVANT, JJ. DATED : 30th September 2010. P.C. : Perused appeal. Heard learned counsel for the appellant and learned counsel for the respondents. 2. This appeal is directed against the order dated 10th July, 1987 passed by the Foreign Exchange Regulatory Board confirming the order dated 5th December, 1984 passed by the Assistant Director of Enforcement, Mumbai under the Foreign Exchange Regulation Act, 1973 (“FERA Act” for short), whereby and whereunder the penalty of Rs.50,000/- has been imposed on the appellant and the foreign currency 2 fera-86.06.sxw of US$ 1,300 is confiscated under section 63 of the FERA Act alleged to have been involved in the contravention of the provisions of the FERA Act. 3. Both authorities below have held against the appellant only on the solitary ground that there was variance between the statements made by the appellant at the time of search and preparation of Panchanama. Copy of the statement was shown to us; wherein the appellant on being questioned by the Officer of the Enforcement Directorate, Mumbai on 15th December, 1989 had made a statement that the seized US $ 1,300 belonged to his mother who had kept it inside the Godrej cupboard in the bedroom of the appellant, when she was in India. According to the appellant, somewhere in the March, 1981 his mother had come to India. At the relevant time brother and sister of the appellant had also come to India and, according to the statement, this amount was gifted to the mother by her son and daughter. Mother is a resident of U.S.A. The brother and sister of the appellant are also residents of U.S.A. 4. Having gone through the statement of the appellant recorded at the time of seizure and preparation of Panchanama, and the defence taken, it is not possible to hold that there is variance between the statement recorded and the affidavits filed on record. So far as appellant is concerned, normally, he may not know how his mother received US $ 1,300. The mother is not expected to tell everything to her son. But one fact is clear from the statement that right from the inception the consistent 3 fera-86.06.sxw stand of the appellant was that money belongs to his mother and not to him. In the circumstances, mere possession cannot be equated with acquisition. Reliance is placed by the appellant on the judgment of the Apex Court in the case of Union of India v. Abdul Mohamed, (2000) 10 SCC 169 which clearly lays down that in absence of any positive material to indicate as to how the foreign exchange was acquired, mere possession thereof cannot be treated as acquisition. In view of the law laid down by the Apex Court holding the field and in absence of any other adverse material on record, both the impugned orders are unsustainable since they suffer from perverse appreciation of evidence. As such, both the impugned order are liable to be quashed and set aside and appeal is liable to be allowed. Order accordingly. 5. The Revenue shall return the US $ 1,300 to the appellant within a period of eight weeks. On receipt of money the appellant would be entitled to deal with the foreign exchange in accordance with law. In the event Revenue fails to pay the amount of foreign exchange to the appellant within stipulated period, the said amount shall carry interest at the rate of 10% per annum after expiry of period of eight weeks. 6. Appeal stands allowed in terms of this order with no order as to costs. (R.M.SAVANT, J.) (V.C.DAGA J.)