Counsel for Appellant :- Sr. S.C.
Counsel for Respondent :- Punit Kumar Upadhyay Hon'ble Dr. Dhananjaya Yeshwant Chandrachud,Chief Justice Hon'ble Pradeep Kumar Singh Baghel,J.
This appeal by the Revenue arises from a decision of the Customs, Excise & Service Tax Appellate Tribunal1 dated 11 March 2014.
The Revenue has raised the following questions of law:
"1. Whether in spite of arriving at the specific conclusion that the delay in filing appeal has been unexplained and in the absence of any express provisions, can the condonation of delay in filing appeal before Commissioner (Appeals) be allowed by Hon'ble CESTAT?
2. Whether, Hon'ble CESTAT was justified in condoning the delay in filing the appeal before the Commissioner (Appeals), beyond statutory period of six month, including condonable period, by imposing a cost, in disregard of the observations made by the Hon'ble Apex Court?
3. Whether, Hon'ble CESTAT can itself condone the delay in filing the appeal before Commissioner (Appeals) and direct to decide the case on merit?"
The facts in the present case fall within a narrow compass. An order of adjudication was made by the Joint Commissioner (Adjudication), Central Excise, Allahabad by which he confirmed a demand of service tax in the amount of Rs. 45.77 lacs under the provisions of Section 73(2) of the Finance Act, 19942 together with interest. The Joint Commissioner also imposed a penalty of Rs. 5,000/- under Section 77 and Rs. 45.77 lacs under Section 78 of the Act of 1994. A copy of the order of adjudication was received by the assessee on 8 October 2011. An appeal against the order of adjudication was filed before the Commissioner of Central Excise (Appeals) on 9 April 2012. An application for condonation of delay was also filed. The Commissioner (Appeals), by an order dated 2 November 2012, dismissed the appeal as being barred by limitation and declined to condone the delay.
The Tribunal on appeal, held that: (i) the period of limitation prescribed under Section 85(3) of the Act of 1994 was three months, which meant three calendar months and not 90 days; (ii) under the proviso to sub-section (3) of Section 85, the Commissioner is empowered to condone the delay for sufficient cause, so as to allow the appeal to be presented within a further period of three months; (iii) in the present case, the order of adjudicating authority was served on 8 October 2011 and the period of limitation of three months together with a further period of three months, within which the delay could be condoned, would expire on 7 April 2012, which was a Saturday and, the appeal was filed on 9 April 2012, which was the next working day; and (iv) the delay should be condoned subject to the payment of interest quantified to Rs. 25,000/-.
The first issue, which has arisen in the appeal, relates to the construction of the provisions of Section 85 of the Act of 1994. Section 85 reads as under;
"Appeals to the Commissioner of Central Excise (Appeals).
85. [(1) Any person aggrieved by any decision or order passed by an adjudicating authority subordinate to the Commissioner of Central Excise may appeal to the Commissioner of Central Excise (Appeals).] (2) Every appeal shall be in the prescribed form and shall be verified in the prescribed manner.
(3) An appeal shall be presented within three months from the date of receipt of the decision or order of [such adjudicating authority], relating to service tax, interest or penalty under this Chapter [, made before the date on which the Finance Bill, 2012 receives the assent of the President]:
Provided 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 three months, allow it to be presented within a further period of three months :
[(3A) 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:
Provided 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.] (4) The Commissioner of Central Excise (Appeals) shall hear and determine the appeal and, subject to the provisions of this Chapter, pass such orders as he thinks fit and such orders may include an order enhancing the service tax, interest or penalty:
Provided that an order enhancing the service tax, interest or penalty shall not be made unless the person affected thereby has been given a reasonable opportunity of showing cause against such enhancement.
(5) Subject to the provisions of this Chapter, in hearing the appeals and making order under this section, the Commissioner of Central Excise (Appeals) shall exercise the same powers and follow the same procedure as he exercises and follows in hearing the appeals and making orders under the Central Excise Act, 1944 (1 of 1944)."
Under sub-section (3) of Section 85, a period of three months is the limitation for filing an appeal against an order of adjudication, and the limitation commences to run from the date of receipt of the decision or order of the adjudicating authority relating to service tax, interest or penalty made before the date on which the Finance Bill 2012 receives the assent of the President. In the present case, the order of adjudication was made on 15 September 2011. Under the proviso to sub-section (3) of the Act of 1994, the Commissioner of Central Excise (Appeals) is empowered, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within a period of three months, to allow it to be presented within a further period of three months. Parliament has used the expression "three months" both while quantifying the original period of limitation as well as while defining the extent to which a delay beyond three months can be condoned. Now, at the outset, it must be noted that the maximum period within which an appeal can be presented before the Commissioner of Central Excise (Appeals), can in no circumstances, exceed six months. This period of six months is comprised of the original period of three months and, if sufficient cause is shown, a further period of three months beyond which the delay cannot be condoned. Once the outer limit of time as stipulated in sub-section (3) of Section 85 has expired, it is not open to the Commissioner (Appeals), or for that matter, to any higher forum, to condone the delay utilizing the provisions of Section 5 of the Limitation Act, 1963. This position in law is not in dispute in view of the judgement of the Supreme Court in Commissioner of Customs and Central Excise Vs Hongo India Private Limited3. The issue, however, that arises in the present case is whether the expression "three months" must be considered to mean 90 days or three calendar months.
In our view, the question does not suffer from any ambiguity. In construing fiscal legislation, the duty of the Court is to interpret the statute and the language used by the legislature by giving to it a plain and natural meaning. Significantly, where the legislature intends to define the period of limitation with regard to the number of days, it does so specifically. In the case of the Act of 1994, Section 85 has defined the period of limitation as well as the power to condone the delay with regard to a stipulation in terms of months and such a stipulation can only mean a calendar month. Once the legislature has used the expression "three months" both in the substantive part of sub-section (3) of Section 85 as well as in its proviso, it would not be open for the Court to substitute the words "three months" by the words "ninety days". To do so, would amount to rewriting the legislative provision, which is impermissible.
The expression "month" is also defined in Section 3(35) of the General Clauses Act, 18974 to mean a month reckoned according to the British calendar. The issue before the Court is not res integra. A similar provision came up for consideration before a Bench of three learned Judges of the Supreme Court in Tamal Lahiri Vs Kumar P.N. Tagore5. In that case, the provisions of Section 533 of the Bengal Municipal Act, 1932, stipulated a period of limitation for filing a prosecution under the Act by providing that no prosecution for an offence under the Act, shall be instituted except within six months next after the commission of such offence. Explaining the import of the expression "six months", the Supreme Court observed as follows;
"6...The only question which then requires examination is whether the prosecution which was filed on June 19, 1968, was instituted as required by S. 533, "within six months next after the commission" of the offence. An argument was raised in the High Court that 'six months' must be construed to mean 180 days and not six calendar months. The High Court does not appear to have accepted that submission. There the High Court is right, because S. 3(27) of the Bengal General Clauses Act, I of 1899, defines 'a month' to mean a month reckoned according to the British calendar. The expression 'six months' which occurs in S. 533 of the Act must accordingly be construed to mean six calendar months and not 180 days. The offence, being alleged to have been committed on the expiry of December 20, 1967, and the prosecution having been instituted on June 19, 1968, the provisions of S. 533 must be held to have been duly complied with."
In the present case, the order of adjudication, it is admitted, was received by the assessee on 8 October 2011. The period of three months would come to an end on 8 January 2012. If sufficient cause was shown, the Commissioner (Appeals) had the jurisdiction to condone a delay of not more than a further period of three months which would expire on 8 April 2012. Admittedly 7 and 8 April 2012 were public holidays (Saturday and Sunday). The day, on which the order was received by the assessee, would have to be excluded in view of the provisions of Section 9 of the Act of 1897. Section 9 stipulates that in any Central Act, it shall be sufficient for the purpose of excluding the first in a series of days or any other period of time, to use the word "from". This provision has been construed in the judgement of the Supreme Court in Saket India Limited Vs India Securities Limited6, to require the exclusion of the day from which the period is to be reckoned in computing the period of limitation. Since the order was received by the assessee on 8 October 2011, that day would be excluded in computing the period of limitation. Since the period of limitation expired on a public holiday and the appeal was filed immediately on the next working day. The Commissioner (Appeals) was not bereft of jurisdiction to condone the delay.
The only issue which survives is as to whether the Tribunal has exercised its discretion to condone the delay in accordance with law. The Tribunal has not condoned the delay beyond the maximum period that is prescribed in Section 85(3) of the Act of 1994. The delay, even at the cost of repetition, is within the outer limit which is prescribed by Section 85(3).
The Tribunal has condoned the delay subject to an order of costs. The Tribunal, in fairness, did observe that though the assessee had not given a detailed elaboration of the reasons for his absence from Mumbai which led to the delay, an order of costs would serve the ends of justice. The Tribunal has taken an overall view in the interest of justice. The issue is as to whether the High Court in the exercise of its appellate jurisdiction can interfere in the exercise of its discretion. Once it is held that the Tribunal did, indeed, have a discretionary jurisdiction, as a first appellate body against the order of the Commissioner (Appeals), this Court would be slow to interfere, particularly having regard to the ambit of the jurisdiction of the Tribunal under Section 86(1) of the Act of 1994. The High Court, in this view of the matter, ought not to substitute its own view in the exercise of discretion where the discretion which has been exercised by the Tribunal is within the parameters of law and the Tribunal is not found to have acted outside its jurisdiction. Consequently and for these reasons, we find that no substantial question of law would arise. The appeal is, accordingly, dismissed.
However, on the request of the learned counsel appearing on behalf of the Revenue, we direct the Commissioner (Appeals) to dispose of the appeal expeditiously and preferably within a period of three months of the receipt of a certified copy of this order.
There shall be no order as to costs.
Order Date :- 29.10.2014 DS/-
(Dr. D.Y. Chandrachud, C.J.) (P.K.S. Baghel, J.) Chief Justice's Court Civil Misc. Delay Condonation Application No. NIL of 2014 IN Case :- CENTRAL EXCISE APPEAL DEFECTIVE No. - 109 of 2014 Appellant :- Commissioner Customs And Central Excise Alld.
Respondent :- Shri Ashok Kumar Tiwari Counsel for Appellant :- Sr. S.C.
Counsel for Respondent :- Punit Kumar Upadhyay Hon'ble Dr. Dhananjaya Yeshwant Chandrachud,Chief Justice Hon'ble Pradeep Kumar Singh Baghel,J.
This is an application for condonation of 13 days' delay in filing the appeal.
The delay has been satisfactorily explained in the affidavit filed in support of the application. Hence, the delay in filing the appeal is condoned.
The application is, accordingly, allowed.
Order Date :- 29.10.2014 DS/-
(Dr. D.Y. Chandrachud, C.J.) (P.K.S. Baghel, J.)