Sections 13 and 14 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 13 says who may impose a penalty or adjudge confiscation under the Act. Section 14 says that no such order can be made until the owner of the goods or conveyance, or the other person concerned, has been given a written notice and a chance to answer. Section 13 is as enacted in 1992; section 14 was amended in 2010 so that "goods" includes goods connected with services or technology. This article explains both as per the Act as enacted in 1992 read with the 2010 Amendment Act, and adds the definition in section 2(a).
The power to impose a penalty or adjudge confiscation belongs to the Director General or to an officer the Central Government authorises by notification, within specified limits. The person who exercises it is the Adjudicating Authority (section 2(a)). No order can be made without a written notice that states the grounds and allows a written representation within a reasonable time, and a hearing if the person wants one. An order made without that notice is made against the plain words of section 14.
Who is the "Adjudicating Authority"
Section 2(a) defines "Adjudicating Authority" as "the authority specified in, or under, section 13". So the term is not a separate office. It is whoever section 13 names, whether directly (the Director General) or through a notification (another officer).
Section 13 reads: "Any penalty may be imposed or any confiscation may be adjudged under this Act by the Director General or, subject to such limits as may be specified, by such other officer as the Central Government may, by notification in the Official Gazette, authorise in this behalf." Take it in three pieces.
| Piece of the section | What it means |
|---|---|
| "Any penalty may be imposed or any confiscation may be adjudged" | Two separate outcomes. A penalty is a sum of money; confiscation is the taking of goods or a conveyance. Both are decided by the same authority. |
| "by the Director General" | The Director General of Foreign Trade, appointed under section 6, can decide directly. |
| "or, subject to such limits as may be specified, by such other officer as the Central Government may, by notification ... authorise" | Another officer can act only if the Central Government names him by a notification in the Official Gazette, and only within the limits specified. |
The sources consulted do not contain any notification naming such officers or fixing their limits. If a notice comes from an officer other than the Director General, the first practical step is to check that a notification authorising that officer exists and that the case falls within its limits. A legal consultation can help you trace it.
Where the Adjudicating Authority appears elsewhere in the Act
The Adjudicating Authority is not only a body that imposes penalties. It is named in other provisions that the reader will meet:
- Section 11(7) lets the Adjudicating Authority suspend the Importer-exporter Code Number of a person who fails to pay a penalty imposed under the Act, "till the penalty is paid or recovered, as the case may be". See our article on recovery, confiscation and redemption.
- Section 11(8) and (9) give it the power to confiscate goods and conveyances and to release them on payment of redemption charges.
- Sections 15 and 17 provide the appeal against its decisions and give it the powers of a civil court. See section 15 and sections 16 and 17.
Section 14: no order without a written notice
Section 14, as it reads after 2010, says: "No order imposing a penalty or of adjudication of confiscation shall be made unless the owner of the goods (including the goods connected with services or technology) or conveyance, or other person concerned, has been given a notice in writing—
(a) informing him of the grounds on which it is proposed to impose a penalty or to confiscate such goods (including the goods connected with services or technology) or conveyance; and
(b) to make a representation in writing within such reasonable time as may be specified in the notice against the imposition of penalty or confiscation mentioned therein, and, if he so desires, of being heard in the matter."
The 2010 Amendment Act (section 14 of that Act) replaced the word "goods" in both places with "goods (including the goods connected with services or technology)". The 1992 text had only "goods". The amendment keeps the notice requirement in step with the wider definition of import and export, which after 2010 covers services and technology. The 2010 Act was brought into force by notification; the date is not in the sources consulted.
What the notice must contain
Reading the section word by word:
- It must be in writing. An oral warning or a telephone call is not a notice under section 14.
- It must go to the right people. The section names "the owner of the goods ... or conveyance, or other person concerned". The last words are wide. A person who is not the owner but is concerned in the matter, for example the exporter who consigned the goods, is within them.
- It must state grounds. Clause (a) requires the notice to inform the person "of the grounds on which it is proposed to impose a penalty or to confiscate". The ground is what the Authority says was contravened. A notice that names no ground does not do what clause (a) asks.
- It must allow a written representation. Clause (b) requires the notice to give a reasonable time, "as may be specified in the notice", to reply in writing. The Act does not fix the number of days. The time is whatever the notice specifies, and it has to be reasonable.
- It must allow a hearing if asked. The phrase "if he so desires, of being heard in the matter" puts the choice with the person served. The hearing is not automatic; it follows a wish to be heard.
Why this notice matters in practice
Section 14 is the point at which the case is open to the person charged. Everything that follows, including the order, a deposit on appeal under the second proviso to section 15(1) and any suspension of the Code, rests on the order, and the order rests on a valid notice.
Example: Meridian Traders (an invented firm) imports goods and receives a letter that says only "you have contravened the Act; pay the penalty". The letter states no ground and gives no time to reply. Under section 14(a) and (b), an order of penalty cannot properly follow such a letter. Meridian would reply in writing, ask for the grounds and ask to be heard.
The section gives no form for the notice and no number of days. Because the time is the one "specified in the notice", read the notice for its date and its stated period at once. The Act does not say what happens to a reply that arrives after that time, so do not rely on a late reply being read. If you cannot meet the period, write before it ends and ask for more time, giving reasons.
For how a penalty is fixed in the first place, see section 11(1) to (4).
The Policy and the Handbook in the background
The Foreign Trade Policy 2023, para 2.60(b) (in the copy consulted), says that the opportunity of a personal hearing before the Director General of Foreign Trade, which the Policy offers for grievances, does not apply to a decision or order made in any proceeding, "including an adjudication proceeding, whether at the original stage or at the appellate stage", under the Act. In plain terms, adjudication under the Act follows the Act's own route and not the Policy's separate hearing route. Policy provisions can change, so the current Policy should be checked.
Need help with a notice under the Foreign Trade Act?
If you have received a notice proposing a penalty or confiscation, the first task is to check who issued it and on what grounds, and to reply within the time it gives. Our legal consultation service can help you read the notice against sections 13 and 14 and prepare the written representation. Later amendments to the Act, the Rules and the Policy should be checked.
Key takeaways
- Penalty and confiscation under the Act are decided by the Director General or by an officer the Central Government authorises by notification, within specified limits (section 13).
- "Adjudicating Authority" means the authority specified in, or under, section 13 (section 2(a)).
- No order imposing a penalty or adjudging confiscation can be made without a written notice stating the grounds and allowing a written representation and, if wanted, a hearing (section 14).
- The time for the reply is the reasonable time "specified in the notice"; the Act sets no number of days.
- The 2010 Amendment Act widened "goods" in section 14 to include goods connected with services or technology; section 13 is unchanged.
Read next
- Section 15: appeal against adjudication orders
- Section 11(1) to (4): contravention, penalty and settlement
- Sections 16 and 17: review and powers of the authorities
- Compounding versus adjudication of offences
Disclaimer: Based on the Foreign Trade (Development and Regulation) Act, 1992 as enacted read with the Amendment Act of 2010, and on the Foreign Trade (Regulation) Rules, 1993 as notified read with the Amendment Rules of 2015, as consulted on 2 October 2026. Later amendments, the current Foreign Trade Policy and the Handbook of Procedures should be checked. This article is general information, not legal advice; check the official text before acting.