2014 (10) TMI 761 - HC - Central Excise

Condonation of delay - ground for seeking condonation of delay is that the appellant was not properly guided in the matter of preferring appeal and was also worried about the huge amount that he would be required to pay at the time of preferring the appeal - Held that - From the facts stated in the memorandum of application, it appears that the work carried out by the appellant is mainly in the nature of labour work, as such, the case put forth by the appellant that he were not aware of the intricacies of law, and therefore, could not approach the Tribunal in time appears to be quite plausible. It appears that the appellant was represented by a Chartered Accountant before the appellate authority and, therefore, relied upon him to give him proper guidance. However, since no proper guidance was given till the appellant contacted the learned advocate who represents him before the Tribunal, there was a delay in preferring the appeal. In the opinion of this court, the appellant had all the reason to hold a reasonable belief that he would be given proper guidance by the Chartered Accountant who had represented him before the appellate authority - Matter restored before Tribunal - Delay condoned.

Summary

Issues:
Delay in preferring the appeal under section 35G of the Central Excise Act, 1944 - Condonation of delay - Justification for delay - Proper guidance for filing appeal - Labour work nature of appellant's business - Tribunal's discretion in not condoning the delay.

Analysis:

1. Condonation of Delay:
The appellant challenged the order of the Tribunal dismissing the appeal due to a delay of 366 days in preferring the appeal. The appellant argued that being a layman and semi-literate, he relied on a service tax consultant for guidance. The consultant advised him to wait for re-quantification of demand and to deposit the entire amount before filing the appeal. The appellant, not well-versed with legal intricacies, faced difficulties in approaching the Tribunal within the limitation period. The High Court observed that the appellant's lack of awareness about service tax laws and reliance on the consultant constituted sufficient cause for condoning the delay. The Court criticized the Tribunal for not considering the appellant's background and the lack of proper guidance provided, leading to the delay. The Court emphasized adopting a pragmatic approach in condoning delays to ensure substantial justice.

2. Tribunal's Discretion:
The Tribunal rejected the application for condonation of delay, stating that the appellant was represented by a Chartered Accountant before the appellate authority and had prosecuted the appeal in time. However, the High Court noted that the appellant's fear of the huge amount required for filing the appeal, coupled with the nature of his labor work business, justified the delay. The Court found the Tribunal's reasoning inadequate and lacking proper consideration of the appellant's circumstances. The Court emphasized that the delay did not cause undue prejudice to the respondent and that condoning the delay would allow the appeal to be heard on merits.

3. Decision and Outcome:
The High Court admitted the appeal, considering the substantial question of law regarding the justification for not condoning the delay. The Court held in favor of the appellant, quashing the Tribunal's order and condoning the delay in filing the appeal. Consequently, the appeal and stay application were restored for further consideration on merits by the Tribunal. The Court's decision highlighted the importance of understanding the appellant's background and circumstances in condoning delays, ensuring a just outcome in legal proceedings.