2012 (9) TMI 308 - HC - Central Excise

Condonation the delay in filing the appeal - Held that - As there is no power vested in the appellate authority to condone the delay of over six months in preferring the appeal, the appeal made by the assessee is hereby dismissed considering delay of 525 days in filing the present appeal - against assessee.

Summary

Issues:
1. Liability of petitioner to pay service tax for construction activity.
2. Show cause notice issued by Assistant Commissioner demanding service tax, interest, and penalty.
3. Delay in filing appeal against the order of Assistant Commissioner.
4. Refusal by second respondent to condone the delay in filing the appeal.
5. Dismissal of appeal by third respondent.
6. Writ petition challenging the orders passed by the respondents.

Analysis:
1. The petitioner, a construction firm, was involved in civil foundation construction for communication towers by M/s.Bharat Sanchar Nigam Limited during assessment years 2005-2006 and 2006-2007. The respondent Department considered this activity as a taxable service falling under commercial and industrial construction service, making the petitioner liable to pay service tax from 10.9.2004. The petitioner paid service tax and interest before any show cause notice was issued, believing it had fulfilled its obligation under Section 73(3) of the Finance Act, 1994.

2. The Assistant Commissioner issued a show cause notice demanding service tax, interest, and penalty, despite the petitioner's explanation. Subsequently, an Order-in-Original was passed on 31.10.2008, demanding specific amounts and imposing a penalty. The petitioner, aggrieved by this order, filed an appeal with the second respondent, albeit with a delay of 525 days, leading to a request for condonation of the delay.

3. The second respondent, citing Section 85 of the Finance Act, 1994, refused to condone the delay beyond three months and rejected the appeal as time-barred in an order dated 27.1.2011. The petitioner then appealed to the third respondent, who dismissed the appeal on 21.10.2011, stating that the delay cannot be condoned.

4. Subsequently, the petitioner filed a writ petition under Article 226 of the Constitution of India challenging the orders of the respondents. The counter affidavit filed on behalf of the respondents asserted that the orders were in compliance with Section 85 of the Finance Act, 1994, which allows a three-month period for filing an appeal, with a further three-month provision for condonation of delay.

5. Upon considering the arguments presented by both parties and examining Section 85 of the Finance Act, 1994, the court concluded that the appellate authority lacked the power to condone delays exceeding six months in filing an appeal. Consequently, the writ petition filed by the petitioner was dismissed, with no costs awarded, and the connected miscellaneous petitions were closed.