2015 (2) TMI 296 - HC - FEMA

Condonation of delay - Held that - A perusal of the averments made in the application moved by the appellant seeking condonation of delay in filing the appeal goes to show that the averments made in the application reflects that the explanation is wholly inadequate and unsatisfactory - Under Section 35 of FEMA, appeal against the decision or order of the Appellate Tribunal may be filed in the High Court within sixty days from the date of communication of the decision or order of the Appellate Tribunal on any question of law arising out of such order. Proviso to Section 35 of FEMA makes it clear that the High Court if satisfied that the appellant was prevented by sufficient cause from filing the appeal within 60 days, may allow it to be filed within a further period not exceeding sixty days. Thus, under Section 35 of FEMA, appeal against the decision or order of the Appellate Tribunal would lie before the High Court provided the appeal is filed within a period of 60 days, extendable by a further period not exceeding 60 days, if the High Court is satisfied that sufficient cause prevented the filing of the appeal within the prescribed period. To put it simply, any appeal filed before the High Court under Section 35 of FEMA beyond 120 days would be time barred. Admittedly, appeal has been filed after considerable long lapse of time i.e. 352 days. Even if it is assumed that certified copy of the impugned order dated 2.3.2009 was received on 31.3.2009 by the appellant and that period has to be excluded from consideration even then, there is a delay of more than 120 days, which cannot be condoned. - Condonation denied.

Summary

Issues:
Delay in filing the appeal under Section 35 of FEMA, applicability of limitation period under FEMA, comparison between Section 19(2) and Section 35 of FEMA, interpretation of law regarding condonation of delay, burden of proof for condonation of delay.

Analysis:
The judgment dealt with an application seeking condonation of a 352-day delay in filing an appeal under Section 35 of the Foreign Exchange Management Act, 1999 (FEMA). The appellant argued that the delay was due to the collective decision-making process in government departments. However, the respondents contended that the limitation period prescribed under Section 35 of FEMA should apply. Reference was made to a Supreme Court decision emphasizing that the law applicable at the time of filing the appeal governs the period of limitation, and in this case, Section 19(2) of FEMA should apply to appeals to the Appellate Tribunal, not Section 52(2) of FERA.

The counsel for the respondents highlighted that Section 19(2) of FEMA allows the Appellate Tribunal to condone delays beyond the 45-day limitation period without an upper limit, whereas Section 35 of FEMA, governing appeals to the High Court, sets a 60-day limitation period with an upper limit for condonation. Citing a Bombay High Court case, it was argued that appeals filed beyond the prescribed period under Section 35 of FEMA cannot be condoned. The judgment emphasized that the law of limitation applies equally to the state and private individuals, and the state must take responsibility for delays caused by its officers.

The judgment referred to various legal precedents and principles, emphasizing that the burden of proof lies with the party seeking condonation to demonstrate a lack of negligence or inaction, along with a genuine cause for the delay. It was highlighted that each case should be assessed based on its unique circumstances. The court noted that the explanation provided by the appellant for the delay was inadequate and unsatisfactory, leading to the dismissal of the application for condonation of delay and subsequently the appeal itself.

The judgment cited Section 35 of FEMA, which allows appeals to the High Court within 60 days from the communication of the Appellate Tribunal's decision, extendable by a further 60 days if sufficient cause is shown. Drawing a parallel with a Supreme Court ruling on the Central Excise Act, it was emphasized that when a statute bars appeals beyond a specified period, the court cannot condone delays exceeding that period. In this case, the appeal was filed after a significant delay of 352 days, rendering it time-barred even after excluding the time for receiving the impugned order. Consequently, the application for condonation of delay was dismissed, leading to the dismissal of the appeal itself.