2012 (12) TMI 113 - AT - Service Tax

Condonation of delay of 383 days in filing Appeal rebate claim for service tax paid on input services used for rendering exported services. - Following the judgement of court in case of RAM NATH SAO @ RAM NATH SAHU AND OTHERS Versus GOBARDHAN SAO AND OTHERS 2002 (2) TMI 1280 - SUPREME COURT held that - each case has to be examined with reference to the facts of the case. The question whether there is a negligence on the part of the appellant is a very relevant question. Further the standards to be adopted while dealing with different types of litigation also has to be different. The standards applicable for a case involving suspension of CHA licence or in the matter of taking steps for substitution of heirs to a property cannot be applied to a matter involving refund of taxes paid. The appellants have been negligent in pursuing the remedies available to them. The power granted to the Tribunal under Section 86(5) is to be exercised only if there has been sufficient cause for the delay. We are not satisfied that the reasons explained are reasonable and sufficient to justify the delay of 383 days. - Decided against the assessee.

Issues:
1. Condonation of delay in filing the appeal.
2. Rejection of refund applications under Section 11B of Central Excise Act.
3. Discretion of the Tribunal under Section 86(5) of Finance Act, 1994.
4. Applicability of precedents in condonation of delay cases.
5. Negligence in pursuing available remedies.
6. Exercise of discretion by the Tribunal.

Condonation of Delay:
The case involved an application for condonation of a 383-day delay in filing an appeal due to unexpected relieving of a key employee responsible for handling tax matters. The appellant argued that no deliberate negligence was involved, and condoning the delay would not prejudice the respondent. However, the Tribunal noted the lack of urgency shown by the appellant even after becoming aware of the issue, leading to the rejection of the condonation application.

Rejection of Refund Applications:
Refund applications for service tax paid on input services used for exported services were rejected under Section 11B of the Central Excise Act due to being time-barred. The Tribunal observed the lack of diligence by the appellants in initially filing the refund claims and in appealing the rejection, without delving into the legal merits of the issue at that stage.

Discretion of the Tribunal:
Section 86(5) of the Finance Act, 1994 grants the Tribunal discretion to condone delays in filing appeals upon showing sufficient cause. Despite the reasons provided for the delay, the Tribunal found the lack of urgency and negligence on the part of the appellant, leading to the rejection of the condonation application.

Applicability of Precedents:
The appellants cited legal precedents related to abatement of suits, suspension of licenses, and delay in matters of declaration of title. However, the Tribunal emphasized the need to consider the specific context of refund claims in tax matters, highlighting the constraints faced by tax authorities in verifying records over extended periods.

Negligence in Pursuing Remedies:
The Tribunal found the appellants negligent in pursuing available remedies, emphasizing the importance of showing sufficient cause for delay under Section 86(5) of the Finance Act, 1994. The lack of reasonable and sufficient reasons to justify the 383-day delay led to the rejection of the condonation application and subsequent appeal.

Exercise of Discretion by the Tribunal:
After an overall assessment of the case's facts and circumstances, the Tribunal concluded that there was no justification to condone the delay. Consequently, both the application for condonation of delay and the appeal were rejected based on the lack of sufficient cause shown for the prolonged delay in filing.

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