Case Law Details
Jalpaiguri Central Engineers Cooperative Society Limited Vs Union of India And Ors. (Calcutta High Court)
The appellate authority has the power to condone the delay beyond the statutory period : Calcutta High Court Held in a Service Tax Case.
In a significant decision, the Calcutta High Court has addressed the issue of condonation of delay in filing a Services Tax Appeal. The petitioner, in this case, had filed an appeal beyond the permissible time frame, i.e., 90 days (normal 60 days plus condonable 30 days) and the court’s ruling has far-reaching implications for similar cases. This article provides a detailed analysis of the case, the court’s findings, and the implications of this decision on Service Tax and Central Excise Appeals.
Detailed Analysis: The crux of the matter revolves around the petitioner-assessee who received a Show Cause Notice on 27th April 2021 for the Financial Year 2015-16 and 2016-17 for Demand of Service Tax (including Cess) in tune of Rs. 82,90,361/-. The said notices eventually led to an adjudication order by the respondent-department on 12th April 2022 where in a part demand of has been confirmed. The petitioner prefer to filed a statutory appeal before the first Appellate Authority on 14th July 2022, as per Section 85 of the Finance Act 1994. However, this appeal was rejected on the grounds that it was filed beyond the permissible time frame.
The respondent cited Section 35 of the Central Excise Act, 1944, which allows for appeals within two months from the date of communication of the decision or order. Furthermore, permits an additional one-month extension under specific circumstances. 3-day delay beyond the permissible limit. The first Appellant Authority relied on Hon’ble Supreme Court in the case of Single Enterprises us Commissioner of Central Excise, Jamshedpur and Ors. [2008 (221) E.LT. 163 (S.C) has held that “ The Commissioner of Central Excise (Appeals) as also the Tribunal being creatures of Statute are vested with jurisdiction to condone the delay beyond the permissible period provided under the Statute. The period up-to which the prayer for condonation can be accepted is statutorily provided. It was submitted that the logic of Section 5 of the Indian Limitation Act, 1963 (in short, the ‘Limitation Act’) can be availed for condonation of delay. Hence, the Appellate Authority concluded that there was no provision in the Finance Act, 1994, to condone such a delay, leading to the dismissal of the appeal.
Conclusion: In light of the facts and arguments presented, the Calcutta High Court’s delved into the provisions of both the Finance Act and the Limitation Act to resolve the issue and decision in this case is pivotal. Hon’ble Justice Gaurang Kanth decided to condone the delay upon citing a similar case by Ld.Counsel for the Petitioner Sri Prosenjit Das, Advocate, i.e., the decision in the case of MAT No. 81 of 2022 titled as S.K.Chakraborty & Sons vs. Union of India & Ors and directed the Service Tax Appelant Authority to dispose of the petitioner’s appeal on its merits. Consequently, the impugned order by the Service Tax Appellant Authority was quashed, and the case was remitted back to them with the instruction to dispose of the petitioner’s appeal for fresh consideration on merit. The court held that the appellate Authority has the power to condone the delay beyond the statutory period . The court emphasized the importance of expeditious resolution of disputes and highlighted that while special statutes may prescribe specific periods of limitation, they may not necessarily exclude the applicability of the Limitation Act. This decision underscores the significance of understanding the provisions of the Service Tax a Central Excise Act and , particularly regarding the timelines for filing appeals, and the courts’ discretion in condoning delays under specific circumstances. It sets a precedent for similar cases in the realm of GST appeals, ensuring that meritorious appeals are not dismissed solely due to procedural delays.
FULL TEXT OF THE JUDGMENT / ORDER OF CALCUTTA HIGH COURT – JALPAIGURI CIRCUIT BENCH
The petitioner in the present writ petition is challenging the show cause notice dated 27.04.2021, order in original dated 12.04.2022 passed by respondent no.3 and the appeal order dated 02.11.2023 passed by the respondent no.2.
Brief facts leading to the present writ petition is as follows :-
The present dispute pertains to the financial year 2015-16 and 2016-17. During the said period, the petitioner was providing works contract service to the government department and government undertakings. Additional/Joint Commissioner of CGST and Central Tax, Siliguri Commissionerate issued a show cause notice dated 27.04.2021 alleging that the petitioner has willfully suppressed the taxable value during the financial year 2015-16 and 2016-17 by not obtaining service tax registration and by not declaring the actual taxable value in the statutory ST-3 returns. After affording an opportunity of hearing, the adjudicating authority passed the order in original dated 11.04.2022 by confirming the demand of service tax to the tune of Rs.24,07,850/-. Aggrieved by the same, the petitioner preferred an appeal before the appellate authority. The appellate authority vide order dated 02.11.2023 summarily rejected the said appeal on the ground of delay.
Learned counsel Sri Prosenjit Das, Advocate for the petitioner submits that the appellate authority has wrongly dismissed the appeal on the presumption that there is no power vested with the appellate authority to condone the delay in filing the appeal beyond 90 days.
However, the Hon’ble Calcutta High Court in MAT No. 81 of 2022 titled as S.K. Chakraborty & Sons Vs. Union of India & Ors has held that the appellate authority under the GST Act has power to condone the delay.
Learned counsel for the respondent conceded to the said legal position and submits that in view of the law laid down by the Hon’ble Division Bench in S.K. Chakraborty (Supra), the appellate authority has the power to condone the delay beyond the statutory period.
As pointed out by the parties, the issue of whether the appellate authority has the power to condone the delay beyond the statutory period is no more res integra in view of the law laid down by the Hon’ble Division Bench in S.K. Chakraborty (Supra).
Hence, in view of the aforesaid legal position, this Court deems it appropriate to set aside the impugned order dated 02.11.2022 and remand the matter back to the appellate authority for fresh consideration on merit.
With the aforesaid directions, the present writ petition is disposed of.
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