Hon'ble Bachchoo Lal,J.
We have heard Sri A.P. Mathur, the learned counsel for the petitioner, and Sri Amit Mahajan who has appeared for the respondent and has filed his appearance slip today. No counter affidavit has been filed even though the petition was admitted eight years back.
The petitioner is aggrieved by the order dated 20th January, 2006 by which the Assistant Commissioner, Central Excise Division-4 NOIDA has directed the petitioner to pay excise duty including education cess on each consignment, at the time of removal of the goods, for a period of two months, starting from the date of the receipt of the order.
The facts leading to the filing of the writ petition is, that the petitioner is engaged in the manufacture of soles and heels falling under Chapter 64 of the Central Excise Tariff Act 1985. The central excise duty is required to be paid as per provision of Rule 8 of the Central Excise Rules 2002. For facility, the said Rule 8 is extracted hereinunder:
"Rule 8 Manner of Payment (1) The duty on the goods removed from the factory or the warehouse during a month shall be paid by the 5th day of the following month:
Provided that in case of goods removed during the month of March, the duty shall be paid by the 31st day of March:
Provided further that where an assessee is availing of the exemption under a notification based on the value of clearances in a financial year, the duty on goods cleared during a calendar month shall be paid by the 15th day of the following month except in case of goods removed during the month of March for which the duty shall be paid by the 31st day of March.
Explanation:- For the purposes of this rule (a) the duty liability shall be deemed to have been discharged only if the amount payable is credited to the account of the Central Government by the specified date;
(b) if the assessee deposits the duty by cheque, the date of presentation of the cheque in the bank designated by the Central Board of Excise and Customs for this purpose shall be deemed to be the date on which the duty has been paid subject to realization of that cheque.A (1A) Notwithstanding anything contained in sub-rule (1), the duty on the goods removed from the factory or the warehouse, in the state of Gujarat, during the second fortnight of February, 2002 and the month of March, 2002 shall be paid by the 31st March, 2002:
Provided that where an assessee in the State of Gujarat is availing of the excemption under a notification based on the value of clearances in a financial year, the duty on goods cleared during the month of February, 2002 shall be paid by the 31st March, 2002.
Explanation- For removal of doubts, it is hereby clarified that the duty liability shall be deemed to have been discharged only if the amount payable is credited to the account of the Central Government by the specified date.
(2) The duty of excise shall be deemed to have been paid for the purposes of these rules on the excisable goods removed in the manner provided under sub-rule (1) and the credit of such duty allowed, as provided by or under any rule.
(3) If the assessee fails to pay the amount of duty by due date, he shall be liable to pay the outstanding amount along with interest at the rate specified by the Central Government vide notification under section 11AB of the Act on the outstanding amount, for the period starting with the first day after due date till the date of actual payment of the outstanding amount.
(3A) If the assessee defaults in payment of duty by the date prescribed in sub-rule (2) and the same is discharged beyond a period of thirty days from the said date, then the assessee shall forfeit the facility to pay the duty in monthly installments under sub-rule (1) for a period of two months, starting from the date of communication of the order passed by the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise, as the case may be, in this regard or till such date on which all dues including interest thereof are paid, whichever is later, and during this period notwithstanding anything cotnained in sub-rule (4) of rule 3 of CENVAT Credit Rules, 2004, the assessee shall be required to pay excise duty for each consignment by debit to the account current and in the event of any failure, it shall be deemed that such goods have been cleared without payment of duty and the consequences and penalities as provided in these rules shall follow.
(4) The provisions of section 11 of the Act shall be applicable for recovery of the duty assessed under rule 6 and the interest under sub-rule (3) in the same manner as they are applicable for recovery of any duty or other sums payable to the central Government."
Under this Rule the excise duty is required to be paid on the 5th day of the following month. If the same is not paid, interest is levied and under Rule (3) the outstanding amount along with interest as per rates specified by the central government can be paid on or before the 30th day from the due date. Under Rule 8 (3A) of the Rules, if the amount along with interest is not paid on or before 30 days from the date of due date, the assessee forfeits the facilities to pay the duty in monthly installments and would be required to pay the amount of duty on consignment basis for a period of two months from the date the order is passed by the Assistant Commissioner, Central Excise.
In the instant case, the excise duty for the month of September, 2005 was required to be paid on or before 5th October, 2005. The same was not paid and, therefore, under sub rule (3) of Rule 8, the Excise duty along with interest at prescribed rates could be paid within thirty days from the due date i.e. upto 4th November, 2005.
The petitioner's case is, that on 1st and 2nd November, 2005 the banks were closed on account of Deepawali festival. On 3rd November, 2005, the bank was closed because of Bhai Dooj festival but the office of the excise department was open and accordingly the petitioner presented a cheque of the due amount to the Joint Commissioner of Excise contending that since the bank was closed and the last date of deposit along with interest was 4th November, 2005, the petitioner requested the Joint Commissioner to accept the cheque. The said cheque was not accepted and was returned with the instruction that the petitioner should present it on the reopening day of the bank. The petitioner contends that 4th November, 2005 was a gazetted holiday and that the office of the department as well as the designated bank, namely, Punjab National Bank was closed. Accordingly, the excise duty alongwith interest accrued thereon was deposited by the petitioner in the designated bank on 5th November, 2005.
Since there was a delay of one day, the impugned order was passed by the Assistant Commissioner, Central Excuse under Rule 8 (3A) of the Rules directing the petitioner to pay excise duty on each consignment for a period of two months.
Since no counter affidavit has been filed the assertions made by the petitioner with regard to the bank being closed on Deepawali festival as well as the fact that he presented the cheque to the Joint Commissioner on 3rd November, 2005 as well as the fact that 4th November, 2005 was a gazetted holiday has not been controverted. Consequently, the assertion made in the writ petition has to be accepted on its face value.
The moot question which arises for consideration is, what would be the position in law if the last date of deposit is a holiday and the amount is deposited on the next working day in which case, whether, the petitioner has committed any default or not. The answer lies under Section 10 of the General Clauses Act which relates to the computation of time. For facility, the said provision is extracted hereinunder:
"10. Computation of time-Where, by any [Uttar Pradesh] Act any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or the last day of the prescribed period, the act or proceedings shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the Court or office is open:
Provided that nothing in this section shall apply to any act or proceeding to which the Indian Limitation Act, 1877, applies."
A perusal of the aforesaid provision indicates that where any act or proceeding is directed or allowed to be done or taken in any court of office on a certain day or within a prescribed period, then if the court of office is closed on that date or last date of the prescribed period, the act or proceedings should be considered as done or taken in due time if it is done or taken on the next day on which the court of office is open.
In Harinder Singh v. S. Karnail Singh, AIR 1957 SC 271, the Supreme Court held that the object of Section 10 was to enable a person to do what he could not have done on a holiday, on the next working day.
In the light of the aforesaid, we are of the opinion that whenever a period is prescribed by a statute for the purpose of an act in a court or office and the period expires on a holiday, then according to Section 10 of the General Clauses Act, the act should be considered to have been done within the period prescribed if it is done on the next working day on which the court or office is open.
In the light of the aforesaid, the petitioner deposited the amount on the next working day i.e. 5th November, 2005 and consequently did not commit any default in depositing the excise duty under Rule 8 of the Central Excise Rules, 2002. Consequently, we find that the impugned order cannot be sustained and is quashed. The writ petition is allowed. There shall be no order as to costs.
Order Date :- 23.5.2014 MT** (Bachchoo Lal,J.) (Tarun Agarwala,J.)