2015 (8) TMI 451 - AT - Service Tax

Demand of service tax - Reverse charge mechanism - Bar of limitation - Held that - appellant filed appeal before Commissioner (Appeals) beyond 90 days and the period of delay is 172 days. Whereas, as per the proviso to sub-section (3A) of Section 85 of Finance Act, the Commissioner (Appeals) may allow further period of 30 days if the appeal is not filed within two months from the date of receipt of Order-in-Original. In this regard, the Hon ble Supreme Court in the case of Singh Enterprises Vs. CCE, Jamshedpur - 2007 (12) TMI 11 - SUPREME COURT OF INDIA has categorically held that Commissioner (Appeals) and the Tribunal has no power to condone the delay beyond the stipulated period - Decided against Assessee.

Summary

Issues:
Demand of service tax under reverse charge mechanism; Appeal dismissal on limitation grounds.

Analysis:
The case involved a dispute regarding the demand of service tax under the reverse charge mechanism. The appellant had filed an appeal before the Commissioner (Appeals) after a delay of 172 days, seeking condonation of the delay. However, the lower appellate authority dismissed the appeal citing the lack of power to condone the delay beyond the stipulated 90 days under Section 85(3A) of the Finance Act. The appellant contended that they had paid the service tax and submitted TR6 challans, but the delay in filing the appeal was beyond the permissible limit. The appellant relied on the proviso to sub-section (3A) of Section 85 and cited a Supreme Court judgment in the case of Singh Enterprises Vs. CCE, Jamshedpur, which held that the appellate authority cannot condone the delay beyond the specified period. The Court emphasized that the appellate authority has no power to allow the appeal to be presented beyond the 30-day extension provided in the proviso, thereby excluding the application of Section 5 of the Limitation Act for condonation of delay.

The appellant argued that certain decisions, including I.T.C.'s case, had allowed condonation of delay on sufficient cause being shown. However, the Court reiterated that "sufficient cause" must be adequate and satisfactory, with no fixed formula for accepting or rejecting explanations for delays. In the present case, the appellant's explanation for the substantial delay of almost 20 months was deemed unsatisfactory, as the appellant had admitted to promptly handing over the order for filing an appeal. The Court emphasized that the lack of business experience leading to the delay was not a valid reason, and previous judgments allowing condonation were considered inapplicable due to the specific circumstances of those cases. Consequently, the Court dismissed the appeal, following the Supreme Court's decision and finding no merit in the appellant's arguments.

In conclusion, the Court upheld the lower appellate authority's dismissal of the appeal as time-barred, in line with the legal principles established by the Supreme Court. The appeal, along with related applications, was consequently dismissed, with no order as to costs.