2017 (3) TMI 312 - AT - Service Tax

Condonation of delay of 111 days - the appeal could not be filed within the stipulated period of three months owing to internal procedures that had to be complied with before filing the appeal - Held that - It is seen that between 23rd May 2016 and 18th July 2016, the Export Inspection Council, the empowered body, was without a Chairman and that without the approval of Chairman funds for pre-deposit, a mandatory requirement for filing of appeals, could not be released - the rigour of procedure for entering into dispute with the tax authorities stood in the way of prompt filing of appeal - the reasons ascribed for failure to file the appeal in time appears to be acceptable - delay condoned - appeal allowed.

Summary

Issues:
Delay in filing appeal before the Appellate Tribunal CESTAT Mumbai.

Analysis:
The case involved an application for condonation of delay in filing an appeal against an order-in-original by the Commissioner of Service Tax, Mumbai - V. The appeal was filed 111 days late, with the applicant citing internal procedures as the reason for the delay. The tax in dispute amounted to ?15,08,93,924 for the period 2009-10 to 2013-14 related to the value of taxable service of "inspection and certification." The Export Inspection Agency, a body of the Central Government responsible for pre-export inspection, was the appellant in this case.

During the hearing, the applicant's Counsel explained that the delay was due to the lack of legal expertise within the organization, which necessitated following prescribed procedures to secure external experts. It was highlighted that the absence of a Chairman in the Export Inspection Council further delayed the process, as the approval for the pre-deposit amount required for filing the appeal could not be obtained until July 18, 2016. Subsequently, the appointment of a legal advisor and obtaining counsel's advice for payment of the pre-deposit and filing the appeal further contributed to the delay.

After reviewing the timeline provided by the applicant, the Tribunal acknowledged the procedural hurdles faced by the Export Inspection Agency in initiating the appeal process promptly. The Tribunal found the reasons for the delay to be acceptable, attributing the delay to the rigorous procedures involved in disputing with tax authorities. Consequently, the Tribunal decided to condone the delay in filing the appeal and directed the Registry to list the appeal for disposal in due course. The judgment was pronounced on 03/02/2017.