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TMI Blog2010 (8) TMI 1123X X X X Extracts X X X X X X X X Extracts X X X X ..... r the CHA Licencing Regulations, 2004 ( the Regulations for short). 3. On the basis of specific information received, a container was intercepted by M P Wing of Commissionerate of Customs (Preventive), Mumbai. It was found to contain assorted electrical and electronic goods of foreign origin. The said goods were imported by M/s. Qureshi International. The cargo was cleared from Nhava Sheva. The clearance of the goods was handled by the Respondent 4. On physical verification, the value of the seized cargo was estimated at ₹ 77,10,000/- as per the value prevailing in the local market as against the declared value of ₹ 10,03,690/-. The importer Shri Riyazuddin Qureshi being untraceable could not be interrogated on second occasion. 5. The statement of Vijay Thakkar, Proprietor of the CHA firm was recorded under Section 108 of the Customs Act, 1962, wherein he accepted the fact that he had attended the said import clearance and also introduced Riyazuddin Qureshi to the suppliers and bankers for financial assistance. The Bill of Entry for the clearance of the subject goods had been filed by him without proper description and correct valuation of the subject goods. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and directions were issued to the Commissioner of Customs (General) to file an appeal against the Order-in-original before the CESTAT, Mumbai Bench at Mumbai. According to the appellant, the said review order inadvertently remained to be dispatched from the office of the Commissioner of Customs (General) to the concerned department. It ultimately, resulted in filing an appeal delayed by 10 days before CESTAT. The Revenue preferred an appeal before the CESTAT along with an application for condonation of delay. The CESTAT rejected the application for condonation of delay relying on the judgment of the larger Bench of the Tribunal in the case of CCEX Mumbai v. AZO Dye Chemical 2000 (120) ELT 201 (Tri-LB) holding the absence of power to condone delay in favour of the Tribunal. In the result, the appeal preferred by Revenue was dismissed by an order dated 28th November, 2005. 9. Being aggrieved by the aforesaid order, the appellate jurisdiction of this Court is invoked by the Revenue-appellant under Section 130A of the Customs Act, 1962. The appeal was admitted to consider the question of law extracted in the opening part of this judgment. SUBMISSIONS 10. The Revenue was initia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stoms Act, went on to urge that no appeal is provided against the order of the larger Bench and that this cannot be a ground to non-suit the Revenue. 14. Mr. Sethna urged that, reading of Sub-section (4) of Section 129D itself shows that the said Sub-section mandates application of the provisions relating to appeals in the Act to the application referred therein. In particular, the Section itself makes a specific reference to the application, inter-alia, of Sub-section (4) of Section 129A of the Customs Act. He, thus, submits that though power to condone delay has been put under a separate Sub-section of the main section, undoubtedly, it is an inherent part of the provision of Sub- Section (4). In fact, all other provisions dealing with limitation and condonation of delay under the Appeal Chapter of the Act, have followed a pattern of stating the period of limitation and providing for condonation of delay. Evidently, the Legislature did not intend to give any different treatment only so far as the provisions of Sub-section (4) is concerned. He submits that the submission is based upon certain sound principles of interpretation. 15. Mr. Sethna submits that if the provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other sections under the Chapter relating to Appeal would be contrary to the intention of the Legislature. 18. Mr. Sethna submits that a narrow interpretation as given by the Larger Bench of the Tribunal could never have been the intention of the Legislature when the provisions in respect of all other Appeals under the said Chapter are benefited by the condonation provision. In this context, our attention was invited to yet another Principle of Construction, which says that the interpretation which is most agreeable to justice and reasons should always be preferred . 19. Mr. Sethna urged that this Court needs to adopt a beneficial construction to the provisions with which we are dealing. According to him, the most reasonable interpretation in the present context which would further the ends of justice is: not to deprive any party to an Application made under Section 129D the benefit of condonation of delay, particularly, when the beneficial interpretation leads to a harmonious construction of the provisions of Sub-section (4) and (5) of Section 129A of the Act. 20. Mr. Sethna submits that Sub-section (4) of Section 129A deals with the right of a party to file cross o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forcement 2006 (197) ELT 18, second in New India Assurance Co. Ltd. v. Nusli Wadia and Anr. 2008 (3) SCC 279, wherein, inter alia, the Court held that a literal construction which leads to an anomalous situation is not contemplated in law. That the provisions of the Acts and the Rules are thus required to be construed keeping in mind the principles envisaged under Article 14 of the Constitution. With a view to give effect thereto, recourse should be to the doctrine of purposive construction. He also placed reliance on the judgment in the case of UCO Bank v. Rajender Lal Kapoor 2008 (5) SCC 257, wherein, the Court reiterated that: It is now a well settled principle of interpretation of Statute that the court must give effect to the purpose and object of the Act . 23. On the above backdrop, Mr. Sethna finally urged that the highly technical and restrictive construction of Section 129D by denying provision of condonation laid down by the larger Bench of the Tribunal in the case of Azo Dychem (supra) may be held to be bad in law and an appropriate construction to the provisions of Section 129D, inter alia, in light of Section 129A of the Customs Act be given by this Court. 24. M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not interfere at this stage because the Tribunal assumes jurisdiction only after the application is filed under Sub-section (4) of Section 129D. If the application is filed within the stipulated time, the Tribunal shall take cognizance thereof and hear the same as if the application were an appeal but on the other hand, when the application is not filed within the stipulated period of 3 months, the Tribunal cannot entertain such an application. 26. Mr. Nankani further contends that the words as if such application were an appeal clearly constitute a legal fiction but such legal fiction has to be given a limited meaning which cannot be extended beyond the purpose for which the legal fiction was created. He also relied upon the judgment of the Apex Court in the matter of UCO Bank and Anr. v. Rajinder Lal Capoor (supra). It is submitted that the legal fiction is limited only to the hearing of the application as if it were an appeal. This is because the words as if are proceeded by the words such application shall be heard by the appellate Tribunal or the Commissioner (Appeals) as the case may be .. . It, therefore, follows that the legal fiction has been introduced for the li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue to challenge an order passed by the Commissioner (Appeals) to the Tribunal. Sub-section (3) provides for the appeal to be filed within 3 months of the communication of the order under challenge. Sub-section (4) then provides for the non-appellant to file a memorandum of cross-objections within 45 days of service of notice of the appeal upon it. Sub-section (5) vests the Tribunal with the power to condone the delay in either the filing of the appeal under Sub-section (3) or the memorandum of cross-objections under Sub-Clause (4). 31. Section 129D gives the Revenue the right to challenge a decision or order made by the Commissioner of Customs. At the relevant time, Sub-section (3) of the said provision provided for a period of 12 months from the date of communication of the order, for the Committee of Chief Commissioners to make an order authorizing the adjudicating authority or any other officer to prefer an application to the Tribunal for determining such points as may arise from the Commissioner s order. Sub-section (4) in turn provided a time of 3 months from the date of the order passed under Sub-section (3), for the making of the application to the Tribunal. As a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve intent to incorporate all provisions of Section 129A, the said words and phrases need not have been used. The legislature does not use superfluous words, and meaning must be ascribed to the said words and phrases, which, as afore-said, restricts the application of the provisions in relation to appeals only to those that relate to the procedure for hearing and passing orders in an appeal before the Tribunal and further appeals therefrom, and by specific reference, to a right to the assessee to file a memorandum of cross-objections. The legislature never intended to incorporate Sub-section (5) of Section 129A or any analogous provision into Section 129D(4). If the arguments canvassed by the Revenue were to be accepted it would amount to reading words into Sub-section (4) of Section 129D, and such a course of action is impermissible. On the other hand, Section 129A is a substantive provision which relates to right to appeal conferred on a person aggrieved by an order of Adjudication Authority and on the Commissioner of Customs, who is aggrieved by the order passed by the Commissioner (Appeals) under Section 128A of the Act. Sub-section (4) of Section 129A deals with the right to fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... should be noted that there is no provision for condonation of any delay in the making of either the order under Sub-section (1) or the application under Sub-section (4). Article 7.11.3 (b) at Page 219 He, thus, submits that the present appeal is liable to be dismissed with costs to the Respondent 41. Mr. Sridharan, learned Counsel appearing as Amicus Curie, submits that when an assessee files an appeal with delay, the same can be condoned by the Tribunal without time limit. Similarly, unlimited delay can be condoned when the appeal is filed by the Commissioner against the order of the commissioner (Appeals) under Section 129A(2). However, delay in filing the application before the Tribunal beyond the time limit mentioned in Section 129D(4) cannot be condoned. In his submission, different periods of limitation can be prescribed for the Government and non-Government litigant, and the same be will not be violative of Article 14. He placed reliance on the judgment of the Apex Court in the case of Nav Rattanmal v. State of Rajasthan 1961 SC 1704. 42. Mr. Sridharan took us through the text of Section 129D(4) and submits that once an application is filed within three months ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne year after the Finance Act, 1984, this reduction in period is intrinsic evidence that the Act does not contemplate grant of further extension of time. 43. Mr. Sridharan, further submits that the duty to be performed by the Collector under Section 129D(4) is purely ministerial and procedural. The Board has to arrive at its satisfaction and record that the order of the adjudicating authority is not legal and proper. The order of the Board under Section 129D(1), has also to specify and point out the points arising out of the decision of the adjudicating authority on which application should be filed before the Tribunal. Therefore, under the first leg of Section 129D(4), the Collector, who is to file an appeal is not expected to apply his mind to the legality of the order to be challenged or apply his mind to the ground of appeal etc. All these are done under Section 129D(1) by the Board. In his submission, surely for such a ministerial act of practically forwarding the papers received from the board to the Tribunal, three months time is adequate. Hence, no further power to extend time to file appeal is provided. 44. Before adjudicating upon the issues raised, it would be usef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application filed by the Adjudicating Authority within three months from the date of communication of the order passed by the Tribunal. If such an application happened to be filed beyond the period of three months, it cannot be admitted by the Tribunal for want of power to condone delay. Such an interpretation, in our view needs to be re-tested on the text of the provisions engrafted in Chapter XV in general and Sub-section (4) of Section 129D of the Act in particular applying settled principles of interpretation of statute. 49. Parties to the appeal have also pressed into service few more judgments relating to the well settled principles of interpretation of statute, reference to which is not necessary since those principles are well recognised. STATUTORY PROVISIONS: The relevant provisions of the Act are set out hereinafter. 50. Section 128 of the Act provides for appeal by the person aggrieved by any decision or order passed under this Act by an Officer of Custom lower in rank than a Collector of Customs and that such an appeal is required to be filed within three months from the date of communication to him of such decision or order . Sub-section (5) of Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision or order of the adjudicating authority. 51. At this stage, we may state that Sub- Section (4) of Section 129D provides that the Adjudicating Authority shall file an application before the Tribunal in pursuance of the order made under Sub-section (1) or (2) within a period of three months from the date of communication of the order under Sub-section (1) and (2) to the Adjudicating Authority. The relevant provision for consideration in the appeal reads as under: D(4): Where in pursuance of an order under Sub-section (1) or Sub- section (2), the adjudicating or any officer of customs authorised in this behalf by the Collector of Customs makes an application to the Appellate Tribunal within a period of three months from the date of communication of the order under Sub-section(1) or Sub- Section (2) to the adjudicating authority, such application shall be heard by the Appellate Tribunal or the Collector (Appeals) as the case may be, as if such applications were an appeal made against the decision or order of the adjudicating authority and the provisions of this Act regarding appeals, including the provisions of Sub-section (4) of Section 129A shall, so far as may be, app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Sub-section (4) of Section 129D of the Act. Sub-section (4) of Section 129A is not only made applicable to the application but it is also made applicable to the cross objections filed. In the absence of specific inclusion of Section (4) of Section 129A, no assessee or noticee, who was aggrieved by part of the order passed by the Adjudicating Authority could file cross objections. Right of appeal or cross objections is required to be conferred by the statute. Since the right flows from the statute, it is a statutory right and not a common law right. In absence of specific conferment of such right, no noticee could file cross objections against the original order passed in an application filed by the adjudicating authority pursuant to the directions given by the Board, before the Appellate Tribunal. For that purpose the provision contained in Sub-section (4) of Section 129A of the Act needs to be read into Sub-section (4) of Section 129D of the Act. The provision contained in Sub-section (4), which states that provisions of this Act regarding appeal shall apply, means that all provisions regarding appeals contained in the Act would be applicable while hearing appeal and/or cros ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The purpose of a deeming provision herein is to make the provisions of the Act dealing with appeals applicable to the application filed under Section 129D(4). 58. Mr. Sridharan, during the course of hearing made a submission contending that Sub-section (5) would be very much applicable to the cross objections arising from the provision of Section 129D(4), if filed beyond a period of 45 days but not to the application arising from the very same provision. In other words, the submission is; where a cross objections is filed beyond a period of 45 days, it is open for the Tribunal to admit or permit the filing of cross objections after the expiry of 45 days, if it is satisfied that there was sufficient cause for not presenting it within that period. But at the same time, the Tribunal has no such power while dealing with an application filed under Section 129D(4) of the Act. In our view, the submission is contradictory. It is a little anomalous that the application giving birth to the cross objections would get the benefit of condonation of delay via Sub-section (5) of Section 129A, but the substantive application which can be called the mother application (to be considered at par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rated in different sections cataloged hereinbelow: (a) Section 128(1) of the Act provides for an appeal to Collector (Appeals) to be made within three months from the date of communication of the order or decision appealed against with power to the Collector to permit the appellant to present the appeal within further period of three months. In other words, the provision for condoning delay to the extent of three months is provided in the proviso to Section 128(1) of the Act. (b) Section 129A(1) provides for an appeal to the Appellate Tribunal to be filed by the aggrieved person within three months from the date of communication of the order mentioned in Clauses (a) to (d) therein with power to the Tribunal in its discretion, to refuse admission of an appeal in respect of the order referred in Clause (b) or (c) or (d) where circumstances mentioned in Sub- clauses (i) to (iii) exist. Sub-section (4) thereof provides for right to file cross objections within 45 days from the date of receipt of notice by the appellant, whereas Sub-section (5) provides for power to condone delay in filing an appeal or cross objections as the case may be. (c) Section 129A(2) provides that on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uding the provisions of Sub-Section (4) of Section 129A shall, so far as may be, apply to such an application. 62. The survey of the above appellate provisions demonstrate that the appeal filed under Sub-section (1) of 128 or 129A by the assessee or under Sub-section (2) of 129A on the directions of Collector of Customs, issued under Sub-section (2) all are governed by the provisions of the Act regarding appeals. The parties availing such remedies form one class or group identified as Appellants , irrespective of the fact, whether the appeal is filed by the assessee or the application is filed by the Revenue or cross objections are preferred by the assessee. All the parties invoking appellate jurisdiction of the Tribunal fall in one category or group. If this be so, can there be a different treatment to a party falling within the same class or group of persons availing the same class of remedy. The answer has to be in the negative. No distinction can be made between the appeal filed by the assessee and the application in the nature of an appeal filed by the Revenue or cross objections filed by the Respondent/assessee as a result of application Under Section 129(4). Any classifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces, the provision of law is required to be interpreted in consonance with the provisions of Article 14 of the Constitution so as to prevent the legislation being exposed to the Constitutional challenge. 66. The Apex Court in the case of Ms. Githa Hariharan and Anr. v. Reserve Bank of India and Anr. AIR 1999 SC 1149 held that if on one construction a given statute will become unconstitutional, whereas on another construction, which may be open, the statute remains within the constitutional limits, the Court should prefer the latter on the ground that the Legislature is presumed to have acted in accordance with the Constitution and Courts generally lean in favour of the constitutionality of the statutory provisions. 67. If one turns to Section 129A which provides for appeals to the Appellate Tribunal, power to condone delay is provided in Sub-section (5) making it a separate substantive provision. It is embedded in the Act itself as to become an integral part of the enactment and thus acquire the tenor and colour of the substantive enactment itself. Considered from this angle, though Sub-section (5) of Section 129A is embedded in the Section as an independent substantive prov ..... X X X X Extracts X X X X X X X X Extracts X X X X
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