Thursday, 27 April 2017

SEARCH, SEIZURE, PENALTY AND CONFISCATION UNDER FOREIGN TRADE DEVELOMENT AND REGULATION ACT, 1992

Power of Search and seizure
Power of search and seizure include right to enter into premises, search, inspection and seize the goods and documents etc..Such power shall be exercise with relation to goods, services and technology. Any government officer may be authorized to exercise power of search and seizure[1].  With reference to goods such authorized officer shall enter into such premises where the goods are kept, stored or processed, manufactured, traded or supplied or received for the purpose of import or export. Such officer shallsearch, inspect and seize such goods, documents, things and conveyances connected with such export and import of goods. With reference to service and technology authorized officer shall enter into such premises where theservice or technology are being  provided, supplied, received   consumed or utilized and search, inspect and seize such goods, documents, things and conveyances connected with such export and import of service and technology. Although such right can be exercise only when the service and technology provider is availing benefit under the foreign trade policy or is dealing with specified service or specified technology.

Power to Impose Penalty
Penalty for contravention
A person can import and export only as per the provision of this Act or rules made thereunder. This Act provides that if any person, in export and import, contravenes or try to contravene any provision of this Act or rules and export and import policy he shall be liable to a penalty[2]upto one thousand rupees or five times the value of the goods in respect of which any contravention is made or attempted to be made, whichever is more.

Penalty for false and tempering document
If any person tempered knowingly and try to tempered any signed declaration, statement or document submitted to Director General and Director General or any officer authorizedreason to believe that such declaration, statement or document is forged, or tampered with or false, he shall be liable to a penalty[3]uptoten thousand rupees or more than five times the value of the goods or services or technology inrespect of which such declaration, statement or document had been submitted, whichever is more. If any person admits any contravention on a notice given by the Adjudicating Authority, the Adjudicating Authority may handle such cases by way of settlement and determine an amount to be paid by that person.

Power to Confiscate Goods or Conveyance
If any person contravene[4] or attempted to contravene any provision of this Act or rules made thereunder or the export and import policythe goods together with any package, and any conveyances shall, be confiscate by the Adjudicating Authority.Such confiscated goods or the conveyance may be released by the Adjudicating Authority on payment of the redemption charges equivalent to the market value of the goods or conveyance by the person concerned.

Mode of Recovery of Penalty
This Act provides several modes for recovery of penalty[5] if any person fails to pay penalty. Modes of recovery of penalty are as-

Recovery of Penalty by deduction
(a)    the Director General may deduct the amount payable under this Act from any money owing to such person.
(b)   the Director General may require custom officer to deduct the amount from any money owing to such person, if such amount is payable  under the Custom Act, 1962 and that person is under the control of custom officer.

Recovery of Penalty by detaining or selling the goods
(c)    the Director General may require any commissioner of custom  to recover the amount by detaining and selling any goods belonging to such person, which are under the control of  such officer and the amount is payable under the Custom Act, 1962.

Recovery of Penalty as arrear of Land Revenue
(d)   If the amount  cannot be recovered from such person in the above stated prescribedmanner, than -
(i)         the Director General or any authorized officer, may prepare the certificate by specifying the amount due from such person and send to District collector in which such person resides or carry on business , and said collector on receipt of such certificate shall proceed to recover such amount from such person as arrear of land revenue. Or
Recovery of Penalty by Selling of property
(ii)        the Director General or any authorized officer,shall exercise his power to detain any movable or immovable property belonging or control to  such person and detain the same until the amount is paid , if amount is payable under  the custom Act, and in case any part of said amount is remain unpaid, or cost of distress or keeping the property remains unpaid for a period of 30 days – director general may sale the property and with the proceeds of such sale , may satisfy the amount payable and costs including cost of sale remaining unpaid and shall render the surplus, if any of such person.

Penalty may be recovered as per the terms of Bond if executed in this concerned[6].

Suspension of Importer and Exporter code Number
If any person fails to pay imposed penalty, the importer and Exporter code Number of the person concerned, may be suspended[7] by the Adjudicating Authority till the penalty is paid or recovered. All sums realized by way of penalties shall be credited to the Consolidated Fund of India[8].

Director General or other officer authorized by the Central Government is Adjudicating Authority andempowered to imposed penalty or adjudge any confiscation under this Act[9].But a reasonable notice has to be given to the owner of the goods connected with services or technology or conveyance or other person concerned before passing of order imposing a penalty or of adjudication of confiscation[10].




[1]Section 10 of FTDR Amendment Act, 1992.The provisions of the Code of Criminal Procedure, 1973 shall apply relating to searches and seizures made under this section.
[2]Section 11(2) of FTDR Amendment Act, 1992.
[3]Section 11(3) of FTDR Amendment Act, 1992.
[4]Section 11(8), (9) of FTDR Amendment Act, 2010.
[5]Section 11(5) of FTDR Amendment Act, 2010.
[6]Section 11(6) of FTDR Amendment Act, 2010.
[7]Section 11(7) of FTDR Amendment Act, 2010.
[8]Section 11Aof FTDR Amendment Act, 2010.
[9]Section 13 of FTDR Amendment Act, 2010.
[10]Section 14of FTDR Amendment Act, 2010.

Dr.(Prof.) Pallavi Gupta
HOD, Law Department

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