Case Note & Summary
The appellant, Rajkumar Shivhare, was issued a show cause notice under Section 3(C) of the Foreign Exchange Management Act, 1999 (FEMA) on 12 January 2005. Upon adjudication, a penalty was imposed under Section 13(2) by order dated 29 February 2008. The appellant moved the Appellate Tribunal under Section 19, but the Tribunal dismissed his application for dispensing with predeposit of the penalty on 17 July 2008. Instead of filing an appeal under Section 35 of FEMA before the High Court, the appellant instituted a writ petition under Article 226 of the Constitution before the Delhi High Court, which dismissed the petition on 24 September 2008 on the ground of lack of territorial jurisdiction and because the remedy of appeal under Section 35 was available. The appellant appealed to the Supreme Court, which by judgment dated 12 April 2010 held that an appeal under Section 35 lies against any order or decision of the Tribunal, including interlocutory orders. The Supreme Court dismissed the appeal but granted liberty to file an appeal under Section 35 before the appropriate High Court within 30 days, directing sympathetic consideration of Section 14 of the Limitation Act. The appellant filed an appeal before the Bombay High Court on 7 May 2010 along with a civil application seeking exclusion of time spent in pursuing the proceedings before the Delhi High Court and the Supreme Court. The Bombay High Court allowed the civil application, holding that the time spent by the appellant in bona fide pursuing his remedy before the wrong forum (Delhi High Court and Supreme Court) is liable to be excluded under Section 14 of the Limitation Act, 1963. The court noted that the appellant was acting bona fide and that the Supreme Court had specifically directed sympathetic consideration of Section 14. The court directed that the appeal be treated as having been filed within limitation and listed for admission.
Headnote
A) Limitation Act - Section 14 - Exclusion of Time - Bona Fide Prosecution in Wrong Forum - The appellant filed a writ petition under Article 226 before the Delhi High Court challenging an interlocutory order of the Appellate Tribunal under FEMA, which was dismissed for lack of territorial jurisdiction. The Supreme Court granted liberty to file an appeal under Section 35 of FEMA before the appropriate High Court and directed sympathetic consideration of Section 14 of the Limitation Act. The Bombay High Court held that the time spent by the appellant in pursuing the writ petition before the Delhi High Court and the appeal before the Supreme Court is liable to be excluded under Section 14 of the Limitation Act, 1963, as the appellant was bona fide pursuing his remedy in a wrong forum. (Paras 1-6) B) Foreign Exchange Management Act, 1999 - Section 35 - Appeal to High Court - Interlocutory Orders - The Supreme Court in the appellant's case held that an appeal under Section 35 of FEMA lies against any order or decision of the Appellate Tribunal, including interlocutory orders, rejecting the contention that only final orders are appealable. (Para 2)
Issue of Consideration
Whether an appellant who files an appeal before the High Court under Section 35 of the Foreign Exchange Management Act, 1999 can seek exclusion of time under Section 14 of the Limitation Act, 1963 for time spent bona fide pursuing proceedings before a wrong forum.
Final Decision
The Civil Application is allowed. The time spent by the appellant in pursuing the proceedings before the Delhi High Court and the Supreme Court is liable to be excluded under Section 14 of the Limitation Act, 1963. The appeal shall be treated as having been filed within limitation. The appeal to be listed for admission.
Law Points
- Section 14 of Limitation Act
- 1963 applies to appeals under Section 35 of FEMA
- 1999
- time spent bona fide in pursuing remedy before wrong forum can be excluded
