Case Law Details
MPPKVV Co Ltd Vs GST And Central Excise Commissioner (Supreme Court of India)
The period during which the matter is pending before the High Court (HC) can be excluded from the limitation period
Introduction: In the case of M/s. MPPKVV Co. Ltd. v. GST and Central Excise Commissioner, the Supreme Court addressed the exclusion of time during pending court proceedings from the limitation period for filing appeals. The court held that the appellant was entitled to exclude the period during which the matter was pending before the High Court, allowing the appeal to be filed within the extended limitation period.
The Hon’ble Supreme Court in the case of M/s. MPPKVV Co. Ltd. v. GST and Central Excise Commissioner [Special Leave Petition (Civil) No. 14223 of 2019 dated February 15, 2024], allowed the civil appeal and held that the Appellant could have no doubt filed an appeal before the Appellate Commissioner within the period of limitation prescribed under sub-section 3A of Section 85 of the Finance Act, 1994 (“the Finance Act”). Therefore, the period during which the matter was pending before the High Court, must be excluded since the High Court specifically granted liberty to the Appellant to file an appeal before the Appellate Commissioner.
Facts:
M/s. MPPKVV Co. Ltd. (“the Appellant”) had claimed a refund of INR 3,83,67,782/- for the period of January 20, 1978 to January 07, 1991. The Assistant Commissioner rejected the refund vide Order dated December 28, 2017 and the Appellant received a copy of the Order on January 08, 2018. Hence, aggrieved by the Order the Appellant filed a writ petition before the Hon’ble High Court. The said writ petition was withdrawn with the liberty to file an appeal before the concerned Appellate Authority vide Order dated March 12, 2018. Therefore, the Appellant preferred an appeal before the Commissioner (Appeals) which was later dismissed vide Order dated April 13, 2018 on the ground that the appeal was delayed by thirty days. Hence, aggrieved by the Order dated April 13, 2018 the Appellant filed an appeal before the Customs, Excise and Service Tax Appellate Tribunal, Principal Bench, New Delhi (“the CESTAT”). The said appeal was dismissed vide Order dated January 29, 2019. Consequently, the appeal was preferred before the Hon’ble High Court of Madhya Pradesh which dismissed vide Order dated April 01, 2019 (“the Impugned Order”).
Hence, aggrieved by the Impugned Order, the present appeal was filed by the Appellant.
Issue:
Whether the period during which the matter is pending before the High Court can be excluded from the limitation period?
Held:
The Hon’ble Supreme Court in Special Leave Petition (Civil) No. 14223 of 2019 held as under:
- Noted that, the Assistant Commissioner rejected the refund on December 28, 2017 and the Appellant received the copy on January 08, 2018.
- Opined that, if the period during which the matter was pending before the High Court, i.e. March 05, 2018 to March 12, 2018, is excluded then the Appellant would have the benefit of the proviso to Sub-Section 3A of Section 85 of the Finance Act. Further, the appeal was not filed within the main provision but the proviso extends the period of limitation by one month. In the instant case, the appeal was filed on April 11, 2018 within a period of one month from March 12, 2018 on which the High Court passed an Order. In such circumstances, in the interest of justice, the delay in filing the appeal was condoned.
- Held that, the Impugned Order of the High Court, orders of the Tribunal and the Appellate Commissioner were set aside. The appeal was liable to be restored on the file of the Commissioner (Appeals), Bhopal.
Section Analysis:
Section 85 of the Finance Act talks about “Appeals to the Commissioner of Central Excise (Appeals)”. According to Section 3A of the Finance Act, an appeal shall be presented within two months from the date of receipt of the decision or order of such adjudicating authority, made on and after the Finance Bill, 2012 receives the assent of the President, relating to service tax, interest or penalty under this Chapter. Proviso to this section mentions that the Commissioner of Central Excise (Appeals) may if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of two months, allow it to be presented within a further period of one month.
Conclusion: The Supreme Court’s decision provides clarity on the exclusion of time during court proceedings for filing appeals under the Finance Act, 1994. By condoning the delay in filing the appeal and remanding the matter for reconsideration, the court ensured that the appellant’s case is heard on its merits. This ruling underscores the importance of equitable application of limitation periods and upholding the principles of justice in legal proceedings.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
Leave granted.
Being aggrieved by the order of the Madhya Pradesh High Court dated 01.04.2019 dismissing the writ petition filed by the appellant under Article 226 of the Constitution, the appellant has preferred this appeal.
Briefly stated the facts are that by an order dated 28.12.2017 the Assistant Commissioner, C.G.S.T. and Central Excise Division, Jabalpur No.1 rejected the claims for refund to an extent of Rs.3,83,67,782/- (Rupees Three Crores, Eighty Three lakhs, Sixty Seven Thousand, Seven Hundred Eighty Two only) for the period 20.01.1978 to 07.01.1991. The said order was initially assailed by the appellant in W.P. No. 5452/2018 before the High Court. However, the said writ petition was withdrawn with liberty to file an appeal before the concerned Appellate Authority vide order dated 12.03.2018. Thereafter, the appellant preferred an appeal being Appeal No.752-ST/2018 before the Commissioner (Appeals) which was dismissed by order dated 13.04.2018 on the ground that the appeal
Being aggrieved by the said order the appellant herein preferred an appeal before the Customs, Excise and Service Tax Appellate Tribunal, Principal Bench, New Delhi (hereinafter referred to as “the Tribunal” for short). By order dated 29.01.2019, the said appeal was also dismissed. Consequently, the appellant preferred W.P. No.6363/2019 before the High Court which by impugned order dated 01.04.2019 was dismissed. Hence, this appeal.
We have heard learned counsel for the appellant and learned counsel for the respondent-Department and also perused the material on record.
During the course of submissions, our attention was drawn to Section 85 of the Finance Act, 1994 to contend that the said provision stipulates the limitation period to be initially two months and thereafter one month subject to sufficient cause being shown by the appellant who prefers an appeal before the Commissioner (Appeals).
Learned counsel for the appellant submitted that sub-section 3A of Section 85 of the Finance Act, 1994 clearly stipulates that an appeal has to be presented within two months from the date of receipt of the decision or order of the Adjudicating Authority made on or after the Finance Bill, 2012 receives presidential assent. The proviso to sub-section 3A of Section 85 of the Finance Act, 1994, states that if the Appellate Commissioner is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of two months may condone the delay and allow the appeal to be presented within a further period of one month.
That in the instant case, the order of the Adjudicating Authority was passed on 28.12.2017 but the order was received by the Appellate Authority only on 08.01.2018. That as against the said order, the appellant preferred W.P. No.5452/2018 and thereafter on the withdrawal of the said writ petition with liberty to avail of the appellate remedy, the appeal was filed on 11.04.2018. The Appellate Commissioner ought to have condoned the delay in filing the appeal, having regard to the liberty granted by the High Court in W.P. No.5452/2018 and also having regard to the proviso to sub-section 3A of Section 85 of the Finance Act, 1994.
He submitted that the Appellate Commissioner, the Tribunal as well as the High Court have not appreciated the facts of this case in their proper prospective and consequently, the appellant’s appeal before the Appellate Commissioner was dismissed on the ground of delay and, therefore, his case has not been heard on merits which has caused prejudice to the appellant. He hence, submitted that the impugned orders may be set aside and the matter may be remanded to the Appellate Commissioner after condoning the delay in filing the appeal.
Per contra, learned counsel of the respondent submitted that there is no merit in this case inasmuch as nothing prevented the appellant herein from approaching the Appellate Commissioner within the period of limitation prescribed under Section 85 of the Finance Act, 1994. Instead, the appellant took a chance before the High Court and when the High Court refused to intervene in the matter, he withdrew the W.P. No.5452/2018 and sought permission to approach the Appellate Commissioner and therefore, the appeal may be dismissed.
We have considered the arguments advanced at the bar in light of the factual matrix of this case. It is not in dispute that the Adjudicating Authority passed its order rejecting the claims for refund made by the appellant herein on 28.12.2017 which order was received by the appellant on 08.01.2018. The appellant could have no doubt filed an appeal before the Appellate Commissioner within the period of limitation prescribed under sub-section 3A of Section 85 of the Finance Act, 1994. However, for reasons best known to the appellant, it approached the High Court under the W.P. 5452/2018. However, the High Court while permitting the appellant to withdraw the said writ petition by its order dated 12.03.2018 also reserved liberty to the appellant herein to seek alternative statutory remedy available in law. Therefore, the period during which the matter was pending before the High Court, i.e. from 05.03.2018 to 12.03.2018 ought to be excluded since the High Court specifically granted liberty to the appellant herein to file the appeal before the Appellate Commissioner.
Consequently, the appellant filed the appeal on 11.04.2018. If the period during which the matter was pending before the High Court, i.e. 05.03.2018 to 12.03.2018, is excluded then the appellant would have the benefit of the proviso to sub-section 3A of Section 85 of the Finance Act 1994. No doubt the said appeal has not been filed within the main provision but the proviso extends the period of limitation by one month. In the instant case, the appeal was filed on 11.04.2018 within a period of one month from 12.03.2018, which is the order of the High Court. In the circumstances, we find that interest of justice would be subserved in this case if, having regard to the proviso to sub-section 3A of Section 85 of the Finance Act, 1994, the delay in filing the appeal is condoned. In the above circumstances, it is condoned.
Consequently, the Appeal No.752-ST/2018 is liable to be restored on the file of the Appellate Commissioner.
In the result, the impugned orders of the High Court, the Tribunal and the Appellate Commissioner are set aside and the matter being Appeal No.752-ST/2018 is restored on the file of the Commissioner (Appeals), Bhopal.
It is needless to observe that the said appeal shall now be considered on its own merits and disposed of as expeditiously as possible.
This appeal is disposed of in the aforesaid terms.
Pending application(s), if any, shall stand disposed of.
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