2015 (9) TMI 587 - HC - Service Tax

Condonation of delay - delay of 26 days - failure to give sufficient reason for delayed filing of the statutory appeal before commissioner (appeals) - Demand of service tax u/s 77 - Penalty u/s 78 - Held that - The right of filing appeal under Section 85 (3A) of the Finance Act is a statutory right conferred on the person concerned by appropriate legislation enacted by the Parliament. Right of appeal, it is well established, is a very valuable right which cannot be taken away by adopting such an approach which is reflected from the impugned order passed by the Commissioner (Appeals) in the instant case. The legal and judicial approach requires the statutory authority to adopt the course which farthers the cause of justice and which enables the person intending to file an appeal not only to exercise that right but to actually avail the same. The endeavour, in such matters, should be to give opportunity to avail the right of appeal, which is a statutory right; rather than to shut it. - The Commissioner is directed to reconsider the application moved by the petitioner for condonation of delay in preferring the appeal and decide the same expeditiously in the light of the observations made above. In case the said application finds favour with the Commissioner, the proceedings of the appeal itself will be expedited. - Decided in favour of assessee.

Summary

Issues:
Validity of order rejecting appeal against service tax demand and penalties under Finance Act, 1994 due to delayed filing of appeal under Section 85 (3A) - Power of Commissioner to allow appeal within extended period - Consideration of illness as a sufficient cause for delayed filing of appeal.

Analysis:
The judgment by the High Court of Allahabad pertains to the challenge against the order passed by the Commissioner (Appeals) Customs, Central Excise & Service Tax, Lucknow, rejecting an appeal against the demand of service tax and penalties imposed under the Finance Act, 1994. The key issue in question was the validity of the rejection based on the delayed filing of the appeal under Section 85 (3A) of the Finance Act, 2012. This section mandates that an appeal must be presented within two months from the date of receipt of the decision or order, with provision for a further one-month extension if sufficient cause is demonstrated.

The petitioner contended that the appeal was filed 26 days beyond the statutory period of 60 days due to the petitioner's illness, which prevented timely communication and instruction to file the appeal. However, the appellate authority found that the medical certificate provided by the petitioner indicated illness from a period that commenced after 56 days from the receipt of the order intended to be challenged by the appeal. The court emphasized that the right of filing an appeal under the Finance Act is a statutory right and a valuable one that should not be denied without proper consideration of circumstances.

The judgment highlighted that the legal and judicial approach should facilitate the exercise of the right of appeal rather than obstructing it. It stressed the importance of enabling individuals to avail themselves of their statutory rights, especially in matters concerning appeals. Consequently, the High Court quashed the impugned order and directed the Commissioner to reconsider the petitioner's application for condonation of delay in filing the appeal promptly, ensuring a fair and expeditious decision. The petitioner was instructed not to seek unnecessary adjournments, with the Commissioner authorized to grant adjournments only in extraordinary circumstances supported by reasoned orders.

In conclusion, the High Court allowed the writ petition, emphasizing the significance of upholding statutory rights, ensuring fair consideration of appeals, and directing a reconsideration of the application for condonation of delay in filing the appeal.