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TMI Blog2007 (1) TMI 112X X X X Extracts X X X X X X X X Extracts X X X X ..... d not be stated and, therefore, the Legislature may have thought fit that it was not necessary to express specifically about the power of the High Court to condone the delay in view of existence of section 29(2). When the statute is silent, the presumption is not drawn automatically about the exclusion of section 29(2) or for that matter section 5 of the Limitation Act. In our thoughtful consideration of the whole matter there is nothing to indicate that the application of section 29(2) is excluded except providing a special limitation. Section 260A does not necessarily imply the exclusion of sections 4 to 24 of the Limitation Act. Thus, there is an overwhelming line of cases holding section 5 of the Limitation Act applicable to the matters in appeal and reference applications to the High Court under the Indian Income-tax Act, the Customs Act and the Bombay Sales Tax Act. Our conclusion in this regard is in line with these cases. We shall finally conclude thus: Section 5 of the Limitation Act shall apply in case of the appeals filed u/s 260A of the Income-tax Act, 1961. - R. M. Lodha , R. M. S. Khandeparkar And N. A. Britto JJ. For the Applicant : S. R. Rivonkar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by providing a different period of limitation which is longer than the period of limitation provided in article 116 of the Limitation Act, clearly indicates its intention in excluding section 5 by necessary implication. His submission is that there is no equity in the tax laws nor the law of limitation. In support of his submission that the Income-tax Act, 1961 is selfcontained code and exhaustive of the matters dealt therein, Mr. S. K. Kakodkar, the senior counsel heavily relied upon the two judgments of the Supreme Court ; (i)Rao Bahadur Ravulu Subba Rao v. CIT [1956] 30 ITR 163 (SC) ; AIR 1956 SC 604 and (ii) STO v. Kanhaiya Lal Makund Lal Saraf 9 STC 747 (SC) ; AIR 1959 SC 135. Senior counsel also relied upon : (i) Fairgrowth Investments Ltd. v. Custodian [2004] 122 Comp Cas 683 (SC) ; [2004] 11 SCC 472 ; (ii) L. S. Synthetics Ltd. v. Fairgrowth Financial Services Ltd. [2004] 122 Comp Cas 185 (SC) ; [2004] 11 SCC 456 ; (iii) Gopal Sardar v. Karuna Sardar [2004] 4 SCC 252 ; (iv) Union of India v. Popular Construction Co. [2001] 8 SCC 470 ; and (v) Commissioner of Central Excise v. Salora International [2006] 206 ELT 61 for the proposition that section 29(2) or for that section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in sections 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law. 8. That the following twin conditions must be satisfied for the applicability of section 29(2) of the Limitation Act have been clearly exposited by the Supreme Court in Mukri Gopalan, AIR 1995 SC 2272. (i) There must be a provision for a period of limitation under any special or local law in connection with any suit, appeal or application ; (ii) The said prescription of period of limitation under such special or local law should be different from the period prescribed by the Schedule to the Limitation Act. 9. In Mukri Gopalan, AIR 1995 SC 2272, the Supreme Court said that if the two requirements are satisfied the consequences contemplated by section 29(2) would automatically follow. 10. Fairgrowth Investments Ltd. [2004] 122 Comp Cas 683 (SC) added additional dim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision of section 260A water tight. The exclusion of the provisions of sections 4 to 24 of the Limitation Act as provided in section 29(2) cannot be lightly inferred. Implied exclusion is not readily inferred. To infer the exclusion of section 5 of the Limitation Act, 1963, by necessary implication, the language of section 260A must suggest that the provision contained therein is mandatory and compulsive and, though not expressly stated, the Legislature intended unequivocally that the provisions of section 5 of the Limitation Act are impliedly excluded. 12. Section 260A of the Income-tax Act reads thus : 260A. (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal, if the High Court is satisfied that the case involves a substantial question of law. (2) The Chief Commissioner or the Commissioner or an assessee aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub-section shall be (a) filed within one hundred and twenty days from the date on which the order appealed against is received by the assessee or the Chief Commissioner or Commissioner ; . . . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... When the statute is silent, the presumption is not drawn automatically about the exclusion of section 29(2) or for that matter section 5 of the Limitation Act. In our thoughtful consideration of the whole matter there is nothing to indicate that the application of section 29(2) is excluded except providing a special limitation. Section 260A does not necessarily imply the exclusion of sections 4 to 24 of the Limitation Act. 14. In so far as the issue before the Supreme Court in the case of Fairgrowth Investments Ltd. [2004] 122 Comp Cas 683, is concerned, in our considered view, the said decision cannot be applied to section 260A of the Income-tax Act. In Fairgrowth Investments Ltd. [2004] 122 Comp Cas 683 the Supreme Court was concerned with the question whether the Special Court was constituted under the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992, has power to condone the delay in filing the petition under section 4(2) of the Act. In holding that section 29(2) of the Limitation Act, 1963, does not apply to the proceedings under section 4(2), the Supreme Court principally relied on three grounds ; (one) that the time limit for filing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingle judge heard and held that the application under section 14 of the Limitation Act was not maintainable in view of sub-section (3) of section 34 of the Act of 1996. The Supreme Court held that since there was no prohibition provided in section 34 of the Act of 1996, section 14 of the Limitation Act can be read in the Act of 1996 which advances the cause of justice. This is what the Supreme Court has to say in this regard (page 246): 19. There is no provision in the whole of the Act which prohibits discretion of the court. Under section 14 of the Limitation Act if the party has been bonafidely prosecuting his remedy before the court which has no jurisdiction whether the period spent in that proceedings shall be excluded or not. Learned counsel for the respondent has taken us to the provisions of the Act of 1996 : like section 5, section 8(1), section 9, section 11, sub-sections (4), (6), (9) and sub-section (3) of section 14, section 27, sections 34, 36, 37, 39(2) and (4), section 41, sub-section (2), sections 42 and 43 and tried to emphasise with reference to the aforesaid sections that wherever the Legislature wanted to give power to the court that has been incorporated in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the period prescribed in clause (a) of sub-section (2) thereof. This special period of limitation will prevail over and exclude the period provided in the Limitation Act for preferring appeal. This prescription of the special period, however, does not necessarily imply that the application of sections 4 to 24 is excluded. In order to exclude the application of sections 4 to 24 within the meaning of section 29 of the Limitation Act, the exclusion must be express and such express exclusion is to be inferred by necessary implication from the statute itself. When the statute is silent and does not even by implication express that sections 4 to 24 would not apply, then the court is not supposed to presume exclusion on account of the statute being silent in that aspect. Sub-section (2) of section 29 makes it clear that if a period pre scribed in the special statute is different from that prescribed in the Limitation Act, the period provided in the Limitation Act shall be subject to the special period prescribed by the special statute and the provisions contained in sections 4 to 24 would apply on the basis of such special period so prescribed in so far as and to the extent to which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period of limitation for filing an application under section 256(2) of the Income-tax Act is provided in section 256 itself and not by the Schedule appended to the Limitation Act. Here, the change in law brought by the introduction of the Limitation Act, 1963, over its predecessor enactment assumes significance. Under the Limitation Act, 1908, section 5 could not be applied to a period of limitation pre scribed by special or local law unless its applicability was specifically attracted. Under section 29(2) of the Limitation Act, 1963, section 5 of the Limitation Act would apply to the periods of limitation prescribed by any special or local law unless such applicability is expressly excluded. It is not disputed that the applicability of the Limitation Act section 5 has not been excluded by section 256 of the Income-tax Act. This controversy stands resolved by the Supreme Court in Mukri Gopalan v. Cheppilat Puthanpurayil Aboobacker, AIR 1995 SC 2272. Their Lordships have held (headnote) : 'Section 29(2) would apply even to a case where a difference between the special law and Limitation Act arose by the omission to provide for limitation to a particular proceeding under the L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Act for the purpose of section 29(2) of the Limitation Act was expressly excluded. The Supreme Court held in paragraph 7 of its report thus (page 260) : 7. In section 8 of the Limitation Act there is reference to suits to enforce rights of pre-emption stating therein that nothing in section 6 or section 7 applies to suits to enforce rights of pre-emption, or shall be deemed to extend, for more than three years from the cessation of the disability or the death of the person affected thereby, the period of limitation for any suit or application. In article 97 of the Schedule appended to the Limitation Act under the heading 'Suits relating to miscellaneous matters' there is reference to enforcement of rights of pre-emption. Thus, there is reference to suits in section 8 and article 97 of the Limitation Act, but there is no reference to an application for enforcement of right of pre-emption. Having regard to the fact that the Act is a self-contained code in relation to the enforcement of rights of pre-emption and looking to the provisions of the Limitation Act, as stated above, it appears to us that when one applies for enforcement of rights of pre-emption under section 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very appeal under section 51-A of the Act is to be filed within one month from the date of passing of the order appealed against. The proviso to the said Rule states that an appeal may be admitted after the said period if the appellant satisfies that he had sufficient reasons for not preferring the appeal within the said period. Thus either section 5 of the Limitation Act or its principles have been expressly and specifically incorporated in the various sections aforementioned. In contrast, although section 8 of the Act prescribes the period of limitation for applying to enforce pre emption rights, it does not speak of application of section 5 of the Limitation Act or its principles. If in the same Act, consciously and expressly, the Legislature has made provision for application of section 5 of the Limitation Act or its principles expressly and specifically to other proceedings such as appeal or revision etc. and such a pro vision is not made for initiation of the proceedings under section 8 of the Act, it necessarily follows that the Legislature did not intend to give benefit of section 5 of the Limitation Act having regard to the nature of right of pre-emption which is considere ..... X X X X Extracts X X X X X X X X Extracts X X X X
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