Case Law Details
Vision Holidays Vs Customs Excise and Service Tax (Madras High Court)
The Madras High Court recently dismissed a writ petition filed by Vision Holidays, challenging an order of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) that rejected their application for condonation of a 2727-day delay in filing an appeal. The case centered on whether sufficient medical evidence was provided to justify the delay, highlighting the complexities and stringent requirements of legal processes in the context of administrative and tax-related appeals.
The appellate order, issued on February 23, 2016, required Vision Holidays to file an appeal by May 23, 2016, as stipulated under Section 86 of the Finance Act, 1994. However, the appeal was not filed until November 13, 2023, accompanied by an application to condone the extensive delay of 2727 days. Vision Holidays attributed the delay to the chronic illness of its Managing Partner, Mr. S.R. Bhoopathy, who was reportedly suffering from a chronic disc prolapse since 2016.
Petitioner’s Argument: The petitioner’s counsel argued that the CESTAT’s dismissal was unjust, as the tribunal failed to adequately consider the medical condition of Mr. Bhoopathy. They cited past judgments, including Tojo Tyre Retread v. CESTAT and Kone Elevator India Pvt. Ltd. v. Secretary Ministry of Finance, which advocate for a liberal interpretation of “sufficient cause” for delay. They also referenced a Bombay High Court ruling in Manish Vorani v. Union of India, emphasizing the need for compassionate consideration in cases involving significant health issues.
Respondent’s Argument: The respondents, represented by senior standing counsel Mr. K. Mohanamurali, contended that the petitioner did not demonstrate a sufficient cause for the delay. They highlighted the extraordinary length of the delay and the inadequacy of the medical evidence provided, which did not explicitly state that Mr. Bhoopathy was incapacitated to the extent of being unable to manage day-to-day affairs during the entire period in question.
CESTAT’s Findings: The CESTAT examined the evidence, including the medical certificate, and concluded that the certificate only indicated that Mr. Bhoopathy was under treatment from 2016 but did not specify his incapacity to handle daily responsibilities. Additionally, the tribunal noted the petitioner’s argument regarding the COVID-19 lockdown but found it insufficient to account for the entire delay period. The Supreme Court precedents cited by the CESTAT further reinforced the need for concrete and comprehensive evidence to support claims of significant delay due to medical reasons.
Conclusion
In its judgment, the Madras High Court upheld the CESTAT’s decision, stating that the tribunal’s findings were reasonable given the evidence presented. The court ruled that Vision Holidays failed to provide a convincing explanation for the delay, and thus, no grounds were established to interfere with the impugned order. This case underscores the critical importance of timely action and robust evidence in legal appeals, especially in administrative and tax matters, where procedural compliance is strictly enforced.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
An order of the Customs Excise and Service Tax Appellate Tribunal, Chennai rejecting an application by the petitioner for condonation of delay is challenged in this writ petition.
2. An appellate order was issued on 23.02.2016. As per Section 86 of the Finance Act, 1994, the appeal should have been filed within two months from the date of receipt of the order. Consequently, in this case, the appeal should have been filed on or before 23.05.2016. The petitioner presented the appeal before the CESTAT on 13.11.2023 along with an application to condone the delay of 2727 days. Since such application was rejected, the present writ petition was filed.
3. Learned counsel for the petitioner submits that the impugned order of CESTAT is liable to be interfered with because the tribunal disregarded the explanation of the petitioner that the Managing Partner, Mr.S.R.Bhoopathy, was suffering from chronic disc prolapse and was under treatment from 2016. In support of the contention that the expression sufficient cause should be construed liberally, he places reliance on the judgment of the Division Bench of this Court in Tojo Tyre Retread v. CESTAT, Chennai 2015(317) E.L.T. 448 (Mad.) and the judgment of the single judge of this Court in Kone Elevator India Pvt. Ltd. v. Secretary Ministry of Finance 2013(32) S.T.R. 262 (Mad.). He also relied on a judgment of the Division Bench of the Bombay High Court in Manish Vorani v. Union of India 2015(316) E.L.T. 575 (Bom.).
4. Mr. K. Mohanamurali, learned senior standing counsel, accepts notice for the respondents. He points out that the petitioner failed to show sufficient cause and that the period of delay is 2727 days.
5. The question that arises for consideration is whether a case is made out to interfere with the impugned order. In the impugned order, the CESTAT took into consideration the petitioner’s pleading that he was seriously ill between March 2016 and October 2023. CESTAT also took into account the submission that there was a lockdown between March 2020 and February 2022 on account of the Covid-19 pandemic. After adverting to judgments of the Supreme Court in Mohan Lal Sharma v. Union of India and another AIR 1981 1346 and Smt. J. Yashoda v. Smt. K. Shobha Rani AIR 2007 SC 1721, the Supreme Court concluded that the evidence provided by the petitioner did not qualify a sufficient cause to explain the considerable delay in filing the appeal.
6. The reasons stated by the petitioner are that he was suffering from chronic disc prolapse at the L4 – L5 level, i.e., Sciatica. With regard to the medical certificate produced by the petitioner in that regard, CESTAT recorded the conclusion that the certificate merely states that the petitioner was under treatment from 2016 and not that he was unable to undertake day to day affairs during the said period. Based on the reasons stated by the petitioner and the evidence submitted in support thereof, in my view, the conclusion of CESTAT in this regard cannot be faulted. Consequently, no case is made out for interference.
7. Therefore, W.P.No.11898 of 2024 is dismissed without any order as to costs.
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