2020 (6) TMI 11 - HC - VAT and Sales Tax

Condonation of delay in filing appeal - appeal filed after a delay of nine years, two months and 15 days - HELD THAT - The reasons given in the application were sufficient to condone the delay. When the affidavit had gone unrebutted and in the affidavit it has been stated that Jaipal was not an employee of the applicant and further it was stated that the applicant was facing financial crunch and the employees were taking voluntary retirement, the delay in filing the appeal ought to have been condoned even though there was a substantial delay. Having had found that there were sufficient reasons given in the delay condonation application, the delay is being condoned - revision allowed.

Summary

Issues:
Delay in filing appeal under U.P. Trade Tax Act, condonation of delay under section 5 of the Indian Limitation Act, sufficiency of reasons for delay, failure to rebut affidavit supporting application for condonation of delay.

Analysis:
The Revision was filed against the order of the First Appellate Court and the judgment of the Second Appellate Court, the Commercial Tax Tribunal. The appeal was filed after a delay of nine years, two months, and 15 days, accompanied by an application under section 5 of the Indian Limitation Act. The applicant argued that the assessment order was served on an individual who was not their employee, and the business had faced financial difficulties leading to closure and subsequent revival with the intervention of the Chief Minister. The delay in filing the appeal was attributed to the retirement of the person responsible for informing the applicant, and the late receipt of the certified copy of the assessment order. The Courts below did not address the reasons provided in the application for condonation of delay, leading to the contention that the order could not be sustained legally.

The Standing Counsel opposed the condonation of delay, highlighting the significant delay in filing the appeal and the rejection of the application under section 5 of the Indian Limitation Act by the lower Courts. The questions of law raised in the Revision were considered, and after hearing arguments from both sides, the Hon'ble Siddhartha Varma found the reasons given in the delay condonation application to be sufficient. The unrebutted affidavit stated that the individual served with the assessment order was not an employee of the applicant, and the financial difficulties faced by the business were compelling factors for the delay. Despite the substantial delay, the Court held that the delay should be condoned.

Consequently, the Court set aside the judgments of the lower Courts and restored the First Appeal to its original number under the U.P. Trade Tax Act, provided the applicant deposited a specified amount with the Legal Services Authority within three weeks. The First Appeal would be heard upon proof of deposit, and the Revision was allowed in favor of the applicant.