JUDGMENT
M.K. Chawla, J.
1. In the month of March, 1980 Shri Issar Das, son of late Shri Khub Chand, purchased a residential house bearing No. O-13, Lajpat Nagar-II, New Delhi, from Shri O. P. Sethi, resident of B-3/34- A,Lawrence Road, Delhi, for a consideration of Rs.1,31,500. A sum of Rs.75,000 was paid by means of a bank draft to the credit of Shri O. P. Sethi. The remaining amount of Rs.56,500 was paid to one shri B. B. Sawhney, general attorney of Shri O. P. Sethi. Thereafter, the sale deed was duly registered and possession delivered.
2. Somehow or other,the officers of the Foreign Exchange Enforcement Branch came to know of this transaction. On enquiry, the Department came to know that at the relevant time, Shri O. P. Sethi was a person resident outside india and as such had no authority to accept the sale consideration without the prior approval of the concerned authorities. On the basis of the investigations of the Directorate, Shri Issar Das served with the following show cause notices:
1. “I Show cause Notice No. T-4/127-D/83-DD, dated November 8, 1983, alleging that during the year 1979-80, Shri Issar Das,son of late Shri Khub Chand, r/o 0-13, Lajpat Nagar II, New Delhi, purchased from Shri B. B. Sawhney, son of Shri Tara Chand, r/o B-3/34-A Lawrence Road. Delhi-35, for Rs.1,31,500 and made payment amounting to Rs.75,000 for the credit of Shri O. P. Sethi, son of late R. R. Sethi, a person resident outside India in contravention of section 9(1)(a) of the Foreign Exchange Regulation Act, 1973.
2, Show cause Notice No. T-4/128-D/83 dated November 8, 1983, alleging that during the year 1979-80 Shri Issar Das, s/o Shri Khub Chand purchased the residential house No. O-13, Lajpat Nagar II, New Delhi, from Shri O. P. Sethi, a person resident outside India, through his attorney, Shri B. B. Sawhney s/o Shri Tara Chand, r/o B-3/34 A,Lawrence Road, Delhi, for Rs. 1,31,1000 and made payment amounting to Rs. 56,500 to Shri B. B. Sawhney, son of Shri Tara Chand a person resident outside India in contravention of section 9(1)(d) of the Foreign Exchange Regulation Act, 1973.”
3. Shri Issar Das was required to show cause in writing within 30 days from the date of the receipt of the said memorandum as to why adjudication proceedings as contained in section 51 of the Foreign Exchange Regulation Act, 1973, be not held against him for the aforesaid contraventions. Shri Issar Das, through his counsel filed a detailed reply denying the allegation contained in the show-cause notices, inasmuch as at the relevant time, he did not know that Shri O. P. Sethi was a person resident outside India. As Shri B,B,Sawhney was competent to enter into the sale agreement, for and on behalf of Shri O. P. Sethi was a person resident outside India. As Shri B. B. Sawhney was competent to enter into the sale agreement, for and on behalf of Shri O. P. Sethi, the transaction was completed and payments made. This defense was not accepted. The learned Deputy Director, vide order dated April 30, 1984, concluded:
“The contention of the learned advocate that Shri Issar Das did not know that Shri O. P. Sethi was a person resident outside India nor he made enquiry regarding Shri Sethi for the reason that Shri Sawhney was the holder of a power of attorney, is not acceptable as Shri Issar Das was a tenant of the same house owned by Shri O. P. Sethi since October, 1978. This house was subsequently purchased by him which is the subject-matter of adjudication. Shri Issar Das in his statement dated July 26, 1983, before the Enforcement Officer has admitted that the rent receipt of the said house was being given by Shri Satish was not residing in the house and subsequently he came to know that he was residing out of India. In the said statement, he has further stated that Shri O. P. Sethi’s family consisting of his mother, wife, three sons and one daughter were residing in one portion of the house and have vacated the portion in January, 1980. Later on he came to know that Shri Sethi’s family members have also left for abroad. At the time of registry, i.e., on March 7, 1980, no one from Sethi’s family was available. From the above statement, it is clear that Shri Issar Das was aware that Shri O. P. Sethi was not residing in India and as such by making a payment of Rs. 75,000 by demand draft in favor of Shri O. P. Sethi, Shri Issar Das contravened the provisions of section 9(1)(a) of the Foreign Exchange Regulation Act, 1973. Similarly by making another payment of Rs.56,500 to Shri B. B. Sawhney by way of sale of the said house owned by Shri O. P. Sethi, a person resident outside India, Shri Issar Das has contravened the provisions of section 9(1)(d) of the Foreign Exchange Regulation Act, 1973.”
4. In view of this finding, the Deputy Director imposed a penalty of Rs.5,000 each for the contravention of the Foreign Exchange Regulation Act, 1973, as shown in the two show-cause notices.
5. Shri Issar Das was not satisfied with the order of the Deputy Director and preferred to file an appeal which was heard and disposed of by the appellate Board on August 28,1985. On the same facts, the Appellate Board came to the conclusion that on record there is nothing to suggest that Shri Issar Das told a lie in his statement. The Board concluded thus:
“The A. O. in his order has based his finding in respect of such knowledge of the appellant on the mere circumstance that the appellant was a tenant in the house for the last about two years and that the rent receipts were being given to him by O. P. Sethi’s son and the family of O. P. Sethi was residing in a portion of the house and vacated the same some time in January, 1980, while the sale deed was executed in early March, 1980. As stated above, we do not see how it can be said with much force that the appellant tenant must have come to know as to where the landlord was actually living. It is not uncommon that individuals stay in other parts of the country for being in service or business and do not visit their families for years. In any case, it cannot be said that a tenant must know as to where the landlord resides In the circumstances, in my view, there was no sufficient reason to discard the statement of the appellant that in fact he did not know till the purchase of the house by him that the owner, O. P. Sethi, was residing outside India. That being so, the finding of the A.O. to the effect that the payments were made by the appellant in contravention of sections 9(1) and 9(1)(d) of the Act was clearly erroneous in law and cannot be sustained. As a result the appeal must succeed.”
6. In the second appeal before this court, the grievance of the U.O.I. is that the Appellate Board has failed to properly interpret the true meaning, object and scope of the provisions contained in section 59 of the Act, inasmuch as it failed to take into consideration the definition of culpable mental state which, besides others, includes knowledge of a fact and belief or reason to believe the fact.
7. Furthermore according to learned counsel, the Appellate board has committed an error in the judgment in rely upon a vague and improbable statement of the respondent to the effect that the he did not know the whereabouts of shri O.P. Sethi. It was for him to discharge the the burden to prove not only that the had no knowledge that shri O.P. Sethi. was a non-resident but also that he hand no reason to believe this fact . On this short ground the appeal according to learned counsel is liable to the accepted.
8. Learned counsel for the respondent has raised two preliminary objections to the maintainability of the present appeal. In this behalf he has placed reliance on thee provision of section 54 of the Act, which reads as under ;
54, Appeal to High Court – An appeal shall lie to the High Court m Only on question of law from any decision or order of the appellate board under sub section (3) or sub-section (4) of section 52.
9. Provident that the High Court shall not entertain any appeal under this section if it is filled after the Appellate Board unless the High Court only on question of law is satisfied that the appellant was prevented by sufficient cause form filing the appeal in time .
10. According to learned counsel the findings of the authorities below are based on pure question of fact. The appellant has not propounded any question of law nor does it arise in this appeal. Furthermore according to learned counsel the appeal is barred by limitation. In the absence of the application the delay cannot be condoned. On these short grounds the appeal merits dismissal.
11. To start with I propose to dispose of the second objection. The impugned order of the appellate Board is dated August 28, 1985. The proviso to section 54 of the Act, provides a limitation of 60 days for filing an appeal to the decision or order of the Appellate Board. The copy of the order of the Appellate Board was sent to the Registrar , FERA Board, vide letter No. FERAB/276/84, dated September 11, 1985. This Letter was received in the office on September 12, 1985. If we calculate the period of 60 days from the date of the communication of the decision, the appellant was required to file the appeal on or before November 11, 1985 . According to learned counsel for the appellant the High Court was close form November 9, 1985, to November 13, 1985. The present appeal was filed in the registry on November 14, 1985 . In that situation, the appeal cannot be said to have been filed beyond the period of limitation . This objection thus has no merit.
12. On the second aspect the respondent has a valid and forcible submission The main question for decision before the Deputy Director and the Appellate Board was as to whether shri Issar Das, at the time of the purchase of the house or when he made the payment had the actual knowledge that Shri O. P. Sethi was a resident outside India. On the same set of evidence, the authorities below have adopted divergent views. This is a pure question of fact. No question of law has been formulated or discussed in any of the orders. The appellant has also not been formulated a question of law requiring serious consideration. Even if it be assumed for the sake of argument that both views are possible there is no reason as to why the view of the Appellate Board be not given preference over the reasoning of the Deputy Director. That being the position, it cannot be said that the orders of the Appellate Board suffer from any legal infirmity or that it committed any error of law in coming to the finding.
13. Learned counsel for the appellant has not been able to point out any circumstance showing that the respondent at the relevant time had the culpable mental state and intentionally bypassed the provisions of the Foreign Exchange Regulation Act. The “culpable mental state” as per the Explanation to section 59 includes the intention, motive, knowledge of fact and belief in or reason to believe a fact. Such a fact can be said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by preponderance of probability. The evidence before the authorities below, even if looked into from this angle, does not establish the intention, motive or the knowledge of the respondent that at the relevant time Shri O. P. Sethi was resident outside India.
14. Besides the reasoning of the Appellate Board with which I fully concur, the following circumstance would also indicate that Shri Issar Das had no occasion or opportunity to know this fact. First of all, Shri Issar Das is an illiterate person and not well versed in English. On the suggestion of one Mr. Sehgal, he agreed to purchase the property and contacted Shri B. B. Sawhney who was holding a valid and legal power of attorney from Shri O. P. Sethi to execute the sale deed. The entire sale consideration was paid by the respondents in two installments. The sum of Rs.75,000 was paid by means of a bank draft and the same was deposited in the joint account of Shri O. P. Sethi and his wife. The second Installment of Rs.56,500 was paid to the attorney. The major portion of the entire consideration was spent by the family of Shri O. P. Sethi in India. It was not expected of the respondent to find out as to who is the actual owner or where he is residing. The attorney was competent to sell the house and through him the transaction was got completed. The sale deed was registered. The attorney passed on the title lawfully and delivered vacant possession of the property in dispute. It may be that Shri Issar Das was residing in the same house as a tenant but that fact by itself is not enough to establish that he had the knowledge or reason to believe that Shri O. P. Sethi is a resident outside India. There is no evidence to infer to the contrary.
15. The point in issue as discussed earlier is based on the factual appraisement of the evidence on the particular circumstances of this case. This being essentially a question of fact where no legal implications are involved, the appeal under section 54 of the Act thus is not maintainable.
16. In the result, I have no hesitation to dismiss the appeal. Ordered accordingly.