2025 (1) TMI 1031 - AT - Central Excise

Condonation of delay of over 1 year and 7 months in filing appeal - sufficient cause for delay or not - clandestine manufacture and clearance of unregistered units - non-production of the finished goods from the other premises - HELD THAT - The Hon ble Apex Court in the landmark judgement governing condonation of delay in the case of COLLECTOR LAND ACQUISITION VERSUS MST. KATIJI AND OTHERS 1987 (2) TMI 61 - SUPREME COURT has laid down a six-point guideline for consideration of the application for condonation of delay. Thus while it is observed that ordinarily a litigant would not stand to gain from a delayed consideration of the matter and while it is too well known that when substantial justice and technical considerations are pitted against each other cause of substantial justice deserves to be preferred; however it is equally important that each day s delay in filing the appeal is required to be explained. It is found that not even a weak attempt at such an explanation accounting for the enormous delay of nearly two years (after discounting suo motu limitation free period) accruing in the present matter. Though time and again Courts have emphasized that sufficient cause ought to be viewed with flexibility but the same in the first place needs to be properly accounted for and satisfied with. Just because the Court has power to condone the delay it cannot be so done mechanically and appeal accepted but for appropriate and justifiable reasons. The apex Court in the case of AJAY DABRA 2023 (1) TMI 1279 - SUPREME COURT refused to condone the delay recently where it was alleged that the appellant was short of funds to pay court fee. It held that the appeal could have been filed and defects attended to (could be removed) thereafter. This is to point out that financial conditions are not a potent reason to admit a COD application. The Hon ble Andhra Pradesh High Court in the case of Shanti Alloys Pvt. Ltd. v. Commissioner of C.Ex. Hyderabad 1998 (12) TMI 92 - HIGH COURT OF JUDICATURE ANDHRA PRADESH AT HYD. had held that a delay in filing appeal beyond ninety days was not condonable in view of the specific provisions of Section 35(1) of the Act. Conclusion - There are no merit in contentions and submissions put forth in the Affidavit and the application for condonation of delay for delayed filing of the present appeal as the obligation to show sufficient cause is on the appellant applying for condonation of delay. The appeal as well as the COD application are hereby dismissed.

1. ISSUES PRESENTED and CONSIDERED

The core legal questions in this judgment are:

Whether the delay in filing the appeal by M/s. Abdul Jabbar & Sons can be condoned under the provisions of the Central Excise Act, 1944.
Whether the reasons provided by the appellant for the delay constitute "sufficient cause" under the law.
What is the impact of the COVID-19 pandemic on the computation of the limitation period for filing the appeal?
How should the court treat the appellant's claims of financial and medical hardships in the context of delay condonation?

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Condonation of Delay

Relevant legal framework and precedents: Section 35B(3) of the Central Excise Act, 1944, allows for filing an appeal within three months from the date of communication of the order. Sub-section (5) provides the Tribunal with discretion to permit a belated filing if "sufficient cause" is shown. Precedents emphasize that each day of delay must be accounted for and justified.
Court's interpretation and reasoning: The court emphasized that the appellant failed to provide a satisfactory explanation for the delay. The affidavit lacked timelines and documentary evidence to support claims of medical and financial hardships.
Key evidence and findings: The appellant's affidavit mentioned medical surgeries and financial difficulties but lacked supporting evidence. The court noted the absence of detailed timelines and documentation.
Application of law to facts: The court applied the legal principle that mere statements without evidence do not constitute "sufficient cause." The delay of over two years was not adequately explained.
Treatment of competing arguments: The appellant's arguments of financial and medical hardships were considered but found insufficient due to lack of evidence. The court balanced these claims against the need for timely justice.
Conclusions: The court concluded that the appellant did not meet the legal requirements for condonation of delay, leading to the dismissal of the application.

Issue 2: Impact of COVID-19 on Limitation Period

Relevant legal framework and precedents: The Supreme Court of India, in a suo motu writ petition, directed the exclusion of the period from March 15, 2020, to February 28, 2022, for limitation purposes due to COVID-19.
Court's interpretation and reasoning: The court acknowledged the exclusion of the COVID-19 period from the limitation computation, which reduced the effective delay period.
Key evidence and findings: The appeal was filed on March 3, 2021. The court calculated the delay, excluding the COVID-19 period, and found it still excessive.
Application of law to facts: The court applied the Supreme Court's directive, but the delay remained unjustified even after accounting for the COVID-19 exclusion.
Treatment of competing arguments: The appellant's reliance on the COVID-19 exclusion was acknowledged but did not suffice to justify the overall delay.
Conclusions: The court concluded that the COVID-19 exclusion did not absolve the appellant from explaining the remaining delay.

Issue 3: Financial and Medical Hardships

Relevant legal framework and precedents: Precedents indicate that financial difficulties and medical issues must be substantiated with evidence to be considered "sufficient cause."
Court's interpretation and reasoning: The court acknowledged the appellant's claims but found them unsubstantiated due to lack of evidence.
Key evidence and findings: The affidavit mentioned surgeries and financial struggles but lacked supporting documents or specific timelines.
Application of law to facts: The court applied the principle that unsupported claims do not justify delay condonation.
Treatment of competing arguments: The court considered the appellant's hardships but emphasized the need for evidence and timelines.
Conclusions: The court concluded that the appellant's claims were insufficient to warrant condonation of delay.

3. SIGNIFICANT HOLDINGS

Preserve verbatim quotes of crucial legal reasoning: "The ends of justice cannot be swayed by emotions. It is often held by courts that in such matters, an appropriate consideration is imperative and important as the opposite party cannot be subjected to the consequence of a delayed appeal."
Core principles established: Each day's delay must be explained with evidence; financial and medical hardships require substantiation; COVID-19 exclusion applies but does not absolve unexplained delays.
Final determinations on each issue: The delay in filing the appeal was not condoned due to lack of sufficient cause and evidence. The application for condonation of delay was dismissed, and consequently, the appeal was also dismissed.

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