2018 (12) TMI 1180 - HC - Central Excise

Condonation of the delay of 1553 days in filing the appeal - whether the appellant had shown sufficient cause for not having preferred any appeal before the Tribunal within the period of limitation? - Held that - the assessee was not correctly advised that they would not be in a position to contest the merits of the matter before the Authority under the VCES. Therefore, the application filed under the VCES was rejected by order dated 15.11.2013 on the technical ground with regard to issuance of notice. - Before the Tribunal, it appears that the assessee was questioned as to whether they had challenged the order dated 27.8.2013, to which, the assessee explained that they pursued the matter under the VCES as they were advised to do so. Not convinced with the explanation, the Tribunal dismissed the appeal by order dated 25.10.2017. The facts clearly show that the reason for the delay has been explained, the explanation offered is reasonable and convincing - thus, the appellant had shown sufficient cause in not being able to prefer the appeal within the period of limitation. The delay in filing the appeal should be condoned - decided in favor of assessee.

Summary

Issues involved:
Delay in filing appeal before the Tribunal and condonation of delay.

Analysis:
The appeal was filed under Section 35G of the Central Excise Act, 1944 against the final order passed by the Tribunal, rejecting the appeal filed by the assessee as barred by limitation and without reason for condonation of the delay. The substantial questions of law raised were related to the rejection of the application seeking condonation of delay without considering the merits of the issue. The main issue for consideration was whether the appellant had shown sufficient cause for not filing the appeal within the limitation period.

The facts revealed a delay of 1553 days in filing the appeal, and the appellant explained the delay by citing reasons related to the demand of service tax, interest, and penalty. The court found the explanation reasonable and convincing, holding that the appellant had shown sufficient cause for the delay. The court also considered the appellant's conduct as bona fide, despite pursuing a wrong remedy initially. The delay, though significant, was properly explained, and the appellant had been prosecuting the matter sincerely in a different forum, warranting condonation of the delay.

The Tribunal's decision was based on a previous case, but the court distinguished the factual matrix of that case from the present one, considering the unique circumstances. Consequently, the court allowed the appeal, set aside the Tribunal's order, and directed the Tribunal to take up the appeal on merits and in accordance with the law. The substantial questions of law were answered in favor of the assessee, with no costs imposed on any party.