Delhi Customs Officials recover smuggled gold worth over Rs 7.5 lakh along with Fake Indian Currency Notes worth Rs 10 lakhs at IGI Airport; 2 arrested (Press release dated 14th Jan 2022)

On 12.01.2022, one Indian passenger, who arrived at T-3, IGI Airport, New Delhi from Ras AI Khanimah International Airport UAE by Flight No. SG753 dated 12.01.2022, was intercepted by the Customs Officers of IGI Airport.

The Customs officers recovered 24 (Twenty four)  pieces of silver plated cylindrical shaped of gold totally weighing 175 grams having tariff value Rs. 7,65,089/-(Rupees Seven Lakh Sixty Five thousand Eighty Nine only) and FICN (Fake Indian Currency Notes) of  face value Rs. 10,00,000/- ( Rupees Ten Lakhs Only) (2,000 notes of denomination 500)  from the pax. In follow up, one Indian national was also intercepted who was supposed to receive the passenger at the arrival gate of the IGI Airport, New Delhi.

The said recovered 24 (Twenty four)  pieces of silver plated cylindrical shaped of gold totally weighing 175 grams and FICN of face value Rs.10,00,000/- were concealed by the pax in his trolley bags and the same were seized under Section 110 of the Customs Act, 1962, on 12.01.2022. The pax and his receiver have been placed under arrest in terms of Section 104 of the Customs Act, 1962. Further investigation is under progress. NIA has also been intimated and they have joined the investigation.

Delhi ROC order for violation of Section 92 (4) & 137(3) of CA, 2013 imposing no penalty by applying amended provisions of Section 454(3) in the case of Central Cottage Industry Corporation of India Ltd. Order dated-13th Jan 2022

Delhi ROC order for violation of Section 92 (4) & 137(3) of CA, 2013 imposing no penalty by applying amended provisions of Section 454(3) in the case of Central Cottage Industry Corporation of India Ltd. Order dated-13th Jan 2022

Applying amended Proviso of section 454(3) of C A, 2013 w.e.f.dated 22 Jan 2021 imposing no penalty

Reference of Proviso of section 454(3) of C A, 2013

Provided that in case the default relates to non-compliance of sub-section (4) of section 92 or sub-section (1) or sub-section (2) of section 137 and such default has been rectified either prior to, or within thirty days of, the issue of the notice by the adjudicating officer, no penalty shall be imposed in this regard and all proceedings under this section in respect of such default shall be deemed to be concluded.

DGGI Officials bust network involving fake invoices worth more than Rs 4,500 crore (Press release dated 14th Jan 2022)

Recently a case was booked by DGGI against some fake firms, which were found non existing at their principal place of business. To trace the real persons behind these fake firms, the physical address from where GST returns were actually filed was ascertained. Then search was conducted on 06.01.2022 at that premises in Delhi. During search, it was found that proprietor is engaged in providing services of ‘Cloud Storage’ on his servers to various customers for maintaining their financial accounts.

On scrutiny of one of the suspicious server, details of certain firms were found in tally data. It was informed by the proprietor that this tally data is being maintained by one syndicate based in Kolkata. The address details of these persons were obtained from Proprietor and then searches were conducted at various premises in Kolkata on 10.01.2022.

During search huge amount of incriminating documents including mobiles phones, various cheque books, stamps of various firms and SIM cards have been recovered. On analysis of electronic devices, documents, mobiles and e-mail of these persons, it has been found that these persons are remotely maintaining data on the server found at the premises in Delhi.

Scrutiny of Tally data has shown that there are 636 firms being operated by this syndicate. The mastermind of syndicate has accepted that they have issued only invoices in these firms and not supplied any goods against them. They have issued invoices involving taxable value of approx. Rs. 4,521 crore  having ITC implication of approx. 741 crore.

During the course of investigation, GST amounting to Rs. 4.52 crore has been got deposited by reversal of ITC available in the ITC ledger of these firms. Further, till now approx. Rs. 7 crore lying in various bank accounts of these firms has been frozen. The mastermind behind the whole racket has been arrested on 13.01.2022. Further investigation in the case is under progress.

Do you know ? -What is Directorate of Enforcement (ED) ? Organization set up & Functions of ED

Directorate of Enforcement is a specialized financial investigation agency under the Department of Revenue, Ministry of Finance, Government of India, which enforces the following laws: –

1. Foreign Exchange Management Act,1999 (FEMA) – A Civil Law, with officers empowered to conduct investigations into suspected contraventions of the Foreign Exchange Laws and Regulations, adjudicate, contraventions, and impose penalties on those adjudged to have contravened the law.

2. Prevention of Money Laundering Act, 2002 (PMLA) – A Criminal Law, with the officers empowered to conduct investigations to trace assets derived out of the proceeds of crime, to provisionally attach/ confiscate the same, and to arrest and prosecute the offenders found to be involved in Money Laundering.

The Prevention of Money Laundering Act, 2002 [PMLA] mandates that the investigation of the offence of money laundering be linked to the Scheduled Offences investigated by the concerned Central or State Law Enforcement Agencies. The scheme of PMLA thus necessitates inter-agency coordination to take effective action against persons who are found by the Law Enforcement Agencies to be involved in criminal activity. Such action under PMLA entails attaching and confiscating tainted assets, and prosecuting persons/entities for the offence of money laundering.

Organization set up

The Directorate of Enforcement, with its Headquarters at New Delhi is headed by the Director of Enforcement. There are five Regional offices at Mumbai, Chennai, Chandigarh, Kolkata and Delhi headed by Special Directors of Enforcement.

Zonal Offices of the Directorate are at Ahmedabad, Bangalore, Chandigarh, Chennai, Kochi, Delhi, Panaji, Guwahati, Hyderabad, Jaipur, Jalandhar, Kolkata, Lucknow, Mumbai, Patna and Srinagar. These are headed by a Joint Director.

The Directorate has Sub-Zonal Offices at Bhubaneshwar, Kozhikode, Indore, Madurai, Nagpur, Allahabad, Raipur, Dehradun, Ranchi, Surat, Shimla, Vishakhapatnam and Jammu which are headed by a Deputy Director.

Functions

The main functions of the Directorate are as under

1.Investigate contraventions of the provisions of Foreign Exchange Management Act, 1999(FEMA) which came into force with effect from 1.6.2000. Contraventions of FEMA are dealt with by way of adjudication by designated authorities of ED and penalties upto three times the sum involved can be imposed.

2.Investigate offences of money laundering under the provisions of Prevention of Money Laundering Act, 2002(PMLA) which came into force with effect from 1.7.2005 and to take actions of attachment and confiscation of property if the same is determined to be proceeds of crime derived from a Scheduled Offence under PMLA, and to prosecute the persons involved in the offence of money laundering. There are 156 offences under 28 statutes which are Scheduled Offences under PMLA.

3.Adjudicate Show Cause Notices issued under the repealed Foreign Exchange Regulation Act, 1973 (FERA) upto 31.5.2002 for the alleged contraventions of the Act which may result in imposition of penalties. Pursue prosecutions launched under FERA in the concerned courts.

4.Processing cases of fugitive/s from India under Fugitive Economic Offenders Act, 2018. The objective of this Act is to provided for measures to deter fugitive economic offenders from evading the process of law in India by staying outside the jurisdiction of Indian Courts and to preserve the sanctity of the rule of law in India.

5.Sponsor cases of preventive detention under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974(COFEPOSA) in regard to contraventions of FEMA.

6.Render cooperation to foreign countries in matters relating to money laundering and restitution of assets under the provisions of PMLA and to seek cooperation in such matters.

Delhi HC dismisses conducting of alleged parallel investigation by various jurisdictional authorities

Delhi HC dismisses conducting of alleged parallel investigation by various jurisdictional authorities

Indo International Tobacco Ltd Vs Vivek Prasad (Delhi High Court) judgement date 11 Jan 2022

Finding: In the facts of the present case, we find that the investigations were initiated by various jurisdictional authorities against different entities. As contended by the respondents, as common thread were allegedly found in these investigations, the same have been transferred to DGGI, AZU to be brought under one umbrella. We also find that in the CGST Act there is no prohibition to such transfer. Section 6(2)(b) of the CGST Act has limited application and therefore, is not applicable to the facts of the present petitions. Similarly, the Circular dated 05.10.2018 also has no application to the facts of the present petitions.

https://documentcloud.adobe.com/link/review?uri=urn:aaid:scds:US:4843e83b-7fa7-3b8e-9f05-3b137fd83c66

ED has arrested Anup Nagaral, Director of M/s. Hoewelai Jinsu, Hong Kong, SAR, China Ltd. under PMLA, 2002 in a case connected with fraud of USD 249.572 million committed on banks under the guise of Merchant Trade.*

*ED has arrested Anup Nagaral, Director of M/s. Hoewelai Jinsu, Hong Kong, SAR, China Ltd. under PMLA, 2002 in a case connected with fraud of USD 249.572 million committed on banks under the guise of Merchant Trade.*

Emergence of Lok Adalat as the most efficacious tool of Alternative Dispute Resolution (Press release dated 12 Jan 2022)

Emergence of Lok Adalat as the most efficacious tool of Alternative Dispute Resolution


A total number of 1,27,87,329 cases were disposed off in 2021

Due to technological advancement like E-Lok Adalats, Lok Adalats have reached doorsteps of parties

National Legal Services Authority (NALSA) is committed to deliver prompt and inexpensive justice to the citizens. Recently, it has decided to lay more emphasis on contribution of National Lok Adalat in effectively reducing the number of pending cases through Alternative Dispute Mechanisms.

To achieve this goal, the Legal Services Authorities shifted to dynamic preparation strategies for organization of the Lok Adalats. As a preparatory measure, NALSA started organization of prior consultative and review meetings with all the State Legal Services Authorities to guide them towards the maximum disposal during such Lok Adalats. Before the organization of each National Lok Adalat, multiple interactions were organised with the Executive Chairpersons of all the State Legal Services Authorities, wherein one-to-one interactions were made to take a stock of the preparations as well as to boost the morale of the stakeholders tasked to organize the Lok Adalats.

A cumulative effect of all the preparatory and mobilization measures resulted in extraordinary disposal figures during the year 2021. Across the country, a total number of 1,27,87,329 cases were disposed of in four National Lok Adalats, which included a huge number of pending cases i.e., 55,81,117 and a record number of pre-litigation cases i.e., 72,06,212. Through these activities the Legal Services Authorities disposed off a large number of cases giving relief to the common citizens by ending or preventing long lasting legal battles.

Achieving these unprecedented disposal figures was not an easy task. A major contribution to this success can be attributed to the technological advancements. In June 2020, the Legal Services Authorities integrated technology with the conventional modes of dispute settlement and introduced virtual Lok Adalats also called as ‘E-Lok Adalats’. Since then, all the Lok Adalats including National Lok Adalats are organized through virtual and hybrid modes. To provide an unhindered experience during the proceedings, the Legal Services Authorities across the country are continuously upgrading their digital infrastructure.

Due to these technological advancements, Lok Adalats have reached to the doorsteps of the parties. The parties are now able to join the Lok Adalat proceedings from their homes or workplaces, saving them the hassle of travelling and reserving a full day for an affair, which gets over within minutes. The Authorities have witnessed that a large number of persons joined the virtual proceedings sitting hundreds of kilometers away from the physical location where the Lok Adalat was organized. Technology has also provided effective ways of supervision and monitoring of Lok Adalats.

The other major factor in the success of Lok Adalats was the formulation of decisive strategies at the National level. Under these strategies, the State Legal Services Authorities were instructed to conduct meetings with various stakeholder across every level with an objective to ensure their full cooperation and coordination. The authorities were guided to follow a litigant friendly approach as well as to persuade such litigants to settle the cases involving settled propositions of law.

Moreover, certain areas of law having greater possibilities of settlement such as NI Act cases, Bank recovery cases along other financial matters were highlighted and authorities were instructed to explore all the possibilities of compromise in such cases. The authorities were advised to proactively monitor the issuance and completion of processes in such financial matters as well as to conduct pre-Lok Adalat sittings to take a matter to a settlement.

There is no doubt regarding the fact that the number of pending cases surged during the ongoing pandemic. However, with a large number of disposals through Lok Adalats, a balance was created by the Legal Services Authorities in the judicial administration of the country. There is no gainsaying that the Lok Adalats settled greater number of cases than any other dispute resolution mechanism and emerged as the most efficacious tool of Alternative Dispute Resolution Mechanism.

During the year, the category wise list of the disposed cases was topped by the Criminal Compoundable Cases, wherein a total number of 17,63,233 such pending cases and 18,67,934 pre-litigation cases were disposed. The second in line were the Revenue cases consisting of 11,59,794 pre-litigation and 14,99,558 pending cases. Apart from these, the other disposed of cases were cheque bounce cases under NI Act, Bank Recovery Cases, Motor Accident Claims, Labour Disputes, matrimonial cases, etc.

Higher addition fee upto 18 times on Certain MCA e Forms (MCA Notification dated 11th Jan 2022)

Higher addition fee upto 18 times on Certain MCA e Forms (MCA Notification dated 11th Jan 2022)

Please note 👉

Above Notification shall not be applicable on section 92(Annual return- Form MGT 7/7A), Section 137 (Form AOC 4). Additional fee Rs. 100/- per day will be applicable without any upper limit

Higher additional fees shall be applicable, if there is delay in filing eform 22 or e form PAS 3, as the case may be, on two or more occasions, within a period of 365 days from date of filing of last such belated eform for which additional fee or higher additional fee, as the case may be, was payable.

Wherever Higher additional fee is payable, additional fee shall not be charged.

Bangalore ROC passed penalty order for violation of Section 117(1) failure to file MGT 14 beyond 300 days by applying lesson penalty pursuant to amended section 446B of CA 2013

Bangalore ROC passed penalty order for violation of Section 117(1) failure to file MGT 14 beyond 300 days by applying lesson penalty pursuant to amended section 446B of CA 2013

Learning points:

-What to do if MGT 14 is not filed within 300 days ?

-How to apply lessor penalty provision as amended section 446B of CA 2013 on Small Company

Please also share your practical experiences in dealing such type of adjudication process.