1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL JURISDICTION FERA APPEAL NO.24 OF 2009 ALONGWITH CIVIL APPLICATION NO.402 OF 2009 Union of India Through Director of Enforcement, Enforcement Directorate, 1st floor, Janmabhoomi Marg, Walchand Hirachand Marg, Mumbai-1 ....Appellants. v. Shri Parag Mehta Executive Director, M/s. L.K.P. Merchant Financing Ltd., 203, Embassy Centre, Nariman Point, Mumbai 400 021 ...Respondents. AND FIRST APPEAL NO.25 OF 2009 ALONGWITH CIVIL APPLICATION NO.404 OF 2009 Union of India Through Director of Enforcement Enforcement Directorate, 1st Floor, Janmabhoomi Marg, Walchand Hirachand Marg, Mumbai-1. ...Appellants. v. M/s. L.K.P. Merchant Financing Ltd., 203, Embassy Centre, Nariman Point, Mumbai- 400 021. ...Respondent. Mr.R.V.Desai, Sr. Counsel with A.S.Rao, advs. For the Appellants. 2 Mr.Kevic Setalwad i/by Tyabji Dayabhai, advs. For the Respondents. CORAM : F.I. REBELLO & J.H. BHATIA, JJ. DATED : 25TH JUNE, 2009 P.C.- ORDER: 1 These two appeals are preferred by the Directorate of Enforcement challenging the order dated 10th June, 2008 passed by the Appellate Tribunal for Foreign Exchange in Appeal No.929 of 2004 and in Appeal No.930 of 2004 setting aside the penalty imposed by the Adjudication Officer on the respondents for violation of provisions of Section 7(4) of the Foreign Exchange Regulation Act (FERA). 2 To state in brief, M/s. L.K.P. Merchant Financing Limited is an authorised money changer and the respondent, Parag Mehta was the Executive Director of the said company. According to the Enforcement Director, during the period from April, 1998 to April, 2000 without verifying the air-tickets of the large number of passengers, respondent/firm had released foreign exchange of US $ 2,41,17,910.14. It’s executive director Parag Mehta was responsible for the same. After giving show-cause notice and after hearing them, the Additional Commissioner of Customs, working as Adjudication Officer, Enforcement Directorate imposed penalty of Rs.35 lac against the 3 company and Rs.5 lac against the the respondent Parag Mehta as an Executive Director of the said company for contravention of Sections 7(4) r/w Section 6(4), 49, 73(3) and 68 of the FERA, 1973. The appeals preferred by both of them before the Tribunal came to be allowed by the impugned order. 3 Heard the learned counsel for the Parties. 4 Paragraph 11(ii) of the FLM provides that: “It should be ensured that the traveler is in possession of a valid passport authorizing travel to the countries proposed to be visited and the traveler is also in possession of a ticket for travel to the country for which the exchange has been applied for.....” In the impugned order, it is noted that the Reserve Bank of India by letter dated 8.5.2000 allowed full permission for release of foreign currency without physical production of air-tickets but only ensuring of confirmed air-tickets is necessary. According to the respondents, all the passengers in whose favour foreign exchange was released had purchased package tours from M/s. SOTC, Kouni Travels India Ltd. who are the authorised travel agencies. The Tribunal ----- noted that “14. This is an admitted position that M/s. SOTC sold package tours to different customers whose price, 4 including (1) of assistance in getting visa and passport (2) to and fro airline transportation (3) site seeing (4) stay in hotel (5) meals and local escorts etc., is charged and paid. The tour manager, i.e. M/s. SOTC, after taking price from the customers arranged other things including booking of air tickets for which it was allowed to have reservation of air tickets by computer and this method is nicknamed as Amadeus. M/s. SOTC, who issued passenger tickets after receipt of the price, used to send requisition forms for foreign exchange against which foreign exchange was released by the respondents. Requisition forms would be signed by the concerned passenger. As package tours consists of besides other things, to and fro air-lines transportation, it was presumed that M/s. SOTC had issued the tickets in view of this and the clarification issued by the RBI. Later on, the Tribunal found that there was no violation of any provisions of the FERA by the respondents. 5 After hearing the learned counsel for the parties and after perusal of the impugned order, we find no fault in the impugned order nor we find any question of law involved in the present appeals. 4 Therefore, both the appeals stand dismissed. 5 As the appeals are dismissed, Civil Application Nos.402 of 2009 and 404 of 2009 seeking stay to the impugned orders do not 5 survive and stand dismissed accordingly. (J.H. BHATIA,J.) (F.I. REBELLO,J.)