2014 (6) TMI 95 - AT - Service Tax

Condonation of delay - as data had to be collected from different collection centres and due to system failure assessee were enforced to calculate manually the exact receipt of Service Tax received from their customers and due to change of system in their software package, the Appellant could not file the Appeals in time - Held that - Impugned Orders had been received by the Appellant on 31-10-2006 and they were required to file the Appeals on or before 31-1-2007. But they did not file the Appeals within the stipulated time and could only file the same before this Tribunal on 29-2-2008 with a delay of 394 days. The reasons for delay contended by the Appellant that there was a system failure in their software system, which got updated only in between September, 2006 to November, 2007. But the Appellant has not explained the cause of delay in filing the Appeals after November, 2007. It is also apparent on record that instead of filing the Appeals before this Tribunal on or before 31-1-2007, the Appellant approached before the Hon ble High Court of Patna only on 15-1-2008, when the Department had commenced the recovery proceedings in November, 2007 itself, and by that time, they had not applied for clearance from the Committee on Disputes, to file the Appeals before this Tribunal. Delay should not be intentional and day-to-day delay in filing appeals has to be explained upto the satisfaction of the Courts. In this case, the Appellant has not explained which factors caused them to challenge the impugned Orders by way of a Writ before the Hon ble High Court of Patna, when their counsel himself had advised them that if the Appeals are to be filed, those should be filed before this Tribunal. Moreover, the preambles of the impugned Orders clearly stated that the appeals are maintainable before this Tribunal only. The Appellant has also failed to explain the delay of another three months after upgradation of the system in Nov. 2007. In these circumstances, we hold that the Appellant has failed to explain satisfactorily the cause of delay in filing the Appeals. Therefore, the Applications for condonation of delay are dismissed - Condonation denied.

Summary

Issues:
1. Condonation of delay in filing appeals.
2. Requirement of obtaining clearance from the Committee on Disputes for filing appeals.
3. Justification for approaching the High Court before the Tribunal.
4. Failure to provide satisfactory explanation for delay in filing appeals.

Analysis:
1. The Appeals and Stay Petitions were filed by M/s. Bharat Sanchar Nigam Ltd. (B.S.N.L) with a delay of 394 days. The Appellant attributed the delay to system failure, manual data calculation, and software package changes. They approached the High Court before the Tribunal based on counsel advice. The Tribunal noted that the Appellant failed to explain the delay post software update in November 2007. The Tribunal held that intentional delay should be explained satisfactorily. The Appeals were dismissed due to the Appellant's failure to justify the delay adequately.

2. The Respondent opposed the condonation of delay, highlighting that BSNL, a public sector undertaking, failed to obtain clearance from the Committee on Disputes before filing the Appeals. The Appeals were disposed of for lack of clearance. The Appellant's reliance on system failure as a reason for delay was refuted, emphasizing the need for timely filing even after system updates. The Tribunal dismissed the Applications for condonation of delay, citing the Appellant's failure to obtain clearance and file within the limitation period.

3. The Appellant's justification for approaching the High Court before the Tribunal was based on the ongoing recovery proceedings by the Department. The Tribunal observed that the Appellant failed to apply for clearance from the Committee on Disputes before filing the Appeals. The Appellant's decision to file a Writ before the High Court instead of directly approaching the Tribunal was not satisfactorily explained. The Tribunal emphasized the importance of following proper appeal procedures as per the Orders' preambles.

4. The Tribunal considered the Appellant's explanations for the delay in filing the Appeals. Despite acknowledging the need to avoid intentional delays, the Tribunal found the Appellant's justifications lacking. The Appellant's failure to provide a convincing reason for the delay post software system update in November 2007 led to the dismissal of the Applications for condonation of delay. The Appeals and Stay Petitions were consequently dismissed by the Tribunal.

This detailed analysis of the judgment highlights the issues related to condonation of delay, obtaining clearance for filing appeals, justifying the approach to the High Court, and explaining delays satisfactorily in legal proceedings.