HC rejects IT firm’s plea to avoid ₹20-cr forex penalty
The tribunal was not obliged to wait for the appellants. It’s the appellants who desire another opportunity to have an adjudication. Their conduct is not consistent and justice cannot be rendered to those who have failed to show their bona fides in the instant case. JUSTICES SC DHARMADHIKARI AND BP COLABAWALLA , Bombay high court
MUMBAI: The Bombay high court on Wednesday dismissed the appeal of Silverline Technologies Ltd, an Indian information technology firm headquartered in the United States, challenging a ₹20-crore penalty levied on them under the Foreign Exchange Management Act (FEMA) for not repatriating more than $20 million and ₹66 crore to India for exporting goods and services abroad.
The company was asked to pay the penalty by a tribunal in 2009 following a case registered by the special enforcement directorate. Along with the company penalty, its chairman and vice-president were each asked to pay ₹1 crore and its director, ₹50 lakh.
In its appeal, the company said its financial condition had deteriorated following the 2008 financial crisis in the US and it was not in a position to pay the penalty even now. The company, seeking relief, said it would be able to pay a penalty of ₹2 lakh.
In 2009, an appellate tribunal said it would hear the company’s case, provided they deposited 20% of the penalty amounts levied on them. After the appellants failed to deposit the amount and did not appear before the tribunal in 2016 and again in January 2018, their appeal against the penalty was dismissed. In light of this, the appellants approached the Bombay high court.
During the high court hearing, the counsel for Silverline Technologies Ltd appealed to a bench of justices SC Dharmadhikari and BP Colabawalla to set aside the appellate tribunal’s deposit payment and reduce their penalty to ₹2 lakh.
The bench, however, dismissed their plea, saying the appellant’s conduct “is not consistent and justice cannot be rendered to those who have failed to show their bona fides in the instant case.”