Madras High Court
Unknown vs The Revision Authority on 7 November, 2014
Author: T.S.Sivagnanam
Bench: T.S.Sivagnanam
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 07.11.2014 C O R A M THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM Writ Petition Nos.19179 and 19180 of 2013 and M.P.Nos.1, 2/2013 and M.P.2/2013 M/s.Shasun Pharmaceuticals Limited formerly known As Shasun Chemicals and Drugs Limited No.28, Sardar Patel Road 3 & 4 Floor, Batra Centre Guindy, Chennai-600 032 ...Petitioner -Vs- 1.The Revision Authority Joint Secretary to the Government of India Ministry of Finance (Department of Revenue) 14, Hudco Vishala Building, B-Wing New Delhi-110 066 2.Customs, Excise and Service Tax Appellate Tribunal South Zonal Bench Shastri Bhavan Annexe Chennai-600 006 3.The Commissioner of Central Excise (Appeals) 26/1, Mahatma Gandhi Road Chennai-600 034 ..Respondents 1 to 3 in both WPs. 4.The Deputy Commissioner of Central Excise No.1, Vallalar Nagar, Manjakuppam, Cuddalore ...Respondent No.4 in W.P.19179/2013 ...Respondent No.5 in W.P.19180/2013 5.The Additional Commissioner of Central Excise Breach Road, Pondicherry-604 001 .. Respondent No.4 in W.P.19180/2013 Prayer in W.P.19179/2013 : Writ Petition filed for issuance of Writ of Certiorarified Mandamus calling for the records of the 1st respondent in File No.195/587-588/11-RA culminating in the issue of Order No.230-231/2013-CX dated 07.03.2013 and quash the same. Prayer in W.P.19180/2013 : Writ Petition filed for issuance of Writ of Certiorarified Mandamus calling for the records of the 1st respondent in File No.195/587-588/11-RA culminating in the issue of Order No.230-231/2013-CX dated 07.03.2013 and quash the same. For petitioner : Ms.V.Pramila For respondents : Mr.K.Ravi Anantha Padmanaban COMMON ORDER
In both these writ petitions, the petitioners have challenged the order dated 08.03.2013, by which the first respondent Revision Authority rejected the petitioners revision petition as being time barred.
2. The petitioners are engaged in the manufacture and clearance of bulk drugs falling under Section 29 of Central Excise Tariff Act, 1985. The petitioner also exports the bulk drugs under claim for Rebate of duty paid under Rule 18 of the Central Excise Rules, 2002. The petitioner has also executed an Undertaking in terms of Rule 19 of the said Rules to cover the requisite duties in the event of failure to export the excisable goods. Rule 18 of the said Rules grants rebate of the duty paid on the goods exported or the duty paid on the materials used in the manufacture of such export goods.
3. The petitioner exported certain drugs and claimed rebate of duty and the rebate was sanctioned by the Maritime Commissioner under Rule 18. The consignments, which were exported were rejected by the overseas buyer and therefore, the petitioner reimported the same without payment of duty in terms of Notification No.158/1995-Customs dated 14.11.1995. Under the said Notification, the reimported goods should be reexported after reprocesing within six months of the date of reimportation or such extended period not exceeding a further period of six months, failing which, the petitioner has to pay the duty leviable on importation of such goods. According to the Department, the petitioner had not reexported the reimported goods after reprocessing as stipulated under the Notification. A show cause notice was issued to the petitioner proposing recovery of the rebate already sanctioned and after affording opportunity to the petitioner. The proposals in the show cause notices were confirmed and the Orders-in-Original dated 27.02.2004 and 31.05.2004 were passed in both the cases.
4. The appeal filed by the petitioner as against the said Orders-in-Original before the Commissioner (Appeals) were rejected and the Orders-in-Original were confirmed. Aggrieved by the same, the petitioner preferred an appeal to the CESTAT (Tribunal) and such appeals were filed before the Tribunal on 16.8.2005 and 17.08.2005 respectively. The petitioner also prayed for stay of the recovery of demand and the Tribunal passed an interim order directing the petitioner to predeposit a total sum of Rs.4,00,000/- in respect of total demand of Rs.8.19 lakhs in both the cases. The petitioner complied with the direction issued by the Tribunal and the appeal was pending before the Tribunal from 2005. Ultimately, the Tribunal, by order dated 11.03.2011 dismissed the appeal on the ground that the appeals are not maintainable and the papers were returned to the petitioner for presentation before the proper forum. The reason for rejecting the appeal is that in terms of first proviso to Section 35B of the Central Excise Act, 1944, the jurisdiction of the Tribunal is ousted and in respect of the order passed by the Commissioner (Appeals) under Section 35A of the Central Excise Act, 1944 (hereinafter called as the Act), only a revision is maintainable before the Revisional Authority viz., the first respondent. The Tribunal, while dismissing the appeal observed that it is open to the revisional authority before whom, the applications are required to be filed to consider the condonation of delay in preferring the revision applications, if such applications are filed before the revisional authority.
5. According to the petitioner, the order passed by the Tribunal dated 14.03.2011 is received by the petitioner on 24.03.2011. The petitioner preferred revision application before the first respondent on 08.07.2011. The first respondent, by the impugned order dated 08.03.2013, rejected the revision petition on the ground that it is clearly time barred under Section 35EE of the Act.
6. Challenging the said order, the petitioner is before this Court. The learned counsel appearing for the petitioner submitted that the petitioner aproached wrong forum by filing appeal before CESTAT and the appeal was pending from 2005 and therefore, while filing revision petition, the period during which the appeal was pending before CESTAT is to be excluded while computing limitation. It is further stated that if the said period is excluded, the petitioners revision application was filed within the period of three months and 14 days after the order passed by the CESTAT, the same was received by the petitioner on 24.03.2011 and the same is within the condonable period of limitation under Section 35EE of the Act. Further the learned counsel submitted that the petitioner has complied with the order of predeposit as directed by the Tribunal and they were bonafidely prosecuting the appeal before the wrong forum. Therefore, the learned counsel contended that the revisional authority ought to have considered the revision petition on merits.
7. Learned Standing counsel appearing for the respondents, after referring to the factual matrix submitted that the revision was filed with a delay of 253 days and there is no power vested with the revisional authority to condone the delay in terms of Section 35EE of the Act in computing the delay of 253 days; the total time taken for filing the revision is 6 years and 3 months and 7 days i.e., from 01.04.2005 i.e., the date on which the appeal order was passed till 08.07.2011 when the revision was filed. Further, it is submitted that if the time during which the petition was pending before the CESTAT was excluded from 16.08.2005 to 14.03.2011 and still the revision was filed beyond the period of 253 days; therefore, beyond the period of condonable limit. He further submitted that Section 14(2) of the Limitation Act is not applicable to the present case. In this regard, reliance was placed in the case of Commissioner of Customs & Central Excise Vs Hongo India (P) Ltd., [2009 (236) ELT 417 (SC)] and the decision reported in the case of M/s.Kaizen Organics Pvt. Ltd., Vs. Union of India [2013 (293) ELT 326 (Rajasthan)], which was passed by the Rajasthan High Court, following the decision of the Honourable Supeme Court. Further it is submitted that since the order was pronounced by the Tribunal in open court in the presence of the Advocate of the petitioner, for all purposes, the relevant date for computation of limitation should be taken as 11.03.2011, the date on which the order was passed by the Tribunal and not 24.03.2011 as submitted by the petitioner. Further it is submitted that the petitioner is a multicrore company and they have big team of legal advisers to advise them for the procedure to be followed; it is rather surprising viz., for the petitioner to contend that they went before wrong forum and they were before wrong forum for more than six years. Therefore, it is submitted that the plea submitted by the petitioner lacks bonafide.
8. Heard the learned counsel for the petitioner and the learned Standing Counsel appearing for the respondent and perused the materials available on record.
9. The short issue which falls for consideration is as to whether the order passed by the first respondent rejecting the revision petition as barred by limitation is just and proper.
10. Section 35EE of the Act deals with revisional powers of the Central Government and it reads as follows:
Section 35EE. Revision by Central Government (1) The Central Government may, on the application of any person aggrieved by any order passed under Section 35A, where the order is of the nature referred to in the first proviso to sub-section (1) of Section 35B, annul or modify such order:
..............
(2) An application under sub-section (1) shall be made within three months from the date of the communication to the applicant of the order against which the application is being made :
Provided that the Central Government may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the aforesaid period of three months, allow it to be presented within a further period of three months.
11. In terms of Sub-Section (2) of Section 35EE of the Central Excise Act, the application for revision of any order passed under Section 35A of the Act shall be filed within 3 months from the date of communication to the applicant of the order, against which, the application is being made in terms of proviso under Sub-Section (2) of Section 35EE, the Central Government, the Revisional Authority, may if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the aforesaid period of 3 months, allow it to be presented within a further peiod of 3 months. Therefore, the period of limitation as stipulated in the said provision is 3 months and the authority has got power to condone the delay for a further period of three months provided the applicant shows sufficient cause.
12. As noticed above, the Order-in-Appeal was passed on 15.03.2005 and received by the petitioner on 01.04.2005. The petitioner filed the appeal before the Tribunal on 16.08.2005, which is well within the period of limitation for filing the appeal before the Tribunal and the appeal was entertained by the Tribunal.
13. According to the petitioner, they were under the bonafide belief that as against the Order-in-Appeal, an appeal lies before the Tribunal.
14. It is true that under normal circumstances, the order passed by the Commissioner are appealable before the Tribunal. The Tribunal did not refuse to entertain the appeal, but took the appeal on file, issued notice to the Department. In the said petition, after hearing the Senior Departmental representative on behalf of the respondent, the Tribunal pased the interim order on 16.06.2006 granting stay of the demand subject to the condition the petitioner deposits a sum of Rs.4 lakhs for both appeals. It appears that the Department did not point out before the Tribunal that appeal was not maintainable as against the Order-in-Appeal dated 15.03.2005 and no steps were taken by the Department to challenge the order passed by the Tribunal though the order was communicated to the Department.
15. It is to be noted that the Tribunal granted extension of time for complying with predeposit order and even when the matter came up before Tribunal during 2006, the issue relating to maintainability of the appeal was not raised by the Department before the Tribunal. Ultimately, the Tribunal took up the appeal for disposal in 2011 and it was pointed out that in the light of the first proviso to Section 35B of the Act, the jurisdiction of the Tribunal is ousted and only a revision is maintainable before the first respondent. Therefore, the appeal filed before the Tribunal was dismissed as not maintainable and the papers were returned to the petitioner for presentation before the proper forum i.e, the first respondent. Further there was an observation that the first respondent could consider the condonation of delay application in preferring the revision applications.
16. The petitioner filed revision petition on 08.07.2011 along with condone delay petition, in which, all the above facts were set out, and submitted that they were bonafidely prosecuting the matter before the wrong forum. However, the Tribunal rejected the application holding that appeal is scrupulously time barred and is beyond the condonable limit prescribed under Section 35EE of the Act. The reason assigned by the first respondent for rejecting the application as time barred is by computing the limitation from the date of the order passed in appeal dated 15.03.2005/01.04.2005. In my view while computing limitation, the starting point of limitation should have been the date on which the order passed by the Tribunal was communicated to the petitioner i.e, 24.03.2011. The learned Standing counsel appearing for the respondents would contend that should not be the date, but the date on which the order passed by the Tribunal, since the petitioner was represented by counsel before the Tribunal. It is to be noted that the Tribunal returned the papers to the petitioner for being presented before the proper forum. The appeal was dismissed as not maintainable and not on merits. Therefore, unless and until the petitioner is intimated with the order along with original papers, the petitioner cannot approach the revisional authority. Therefore, in the petitioners case, the period of limitation should commence to run from the date of which the petitioner received the certified copy of the order passed by the Tribunal along with papers. If such date is taken, the delay has to be computed from 24.03.2011 and the petitioner preferred the revision petition on 08.07.2011 i.e., after the period of three months and 14 days from the date on which the order passed by the Tribunal had been communicated to them along with return of papers for presenting before the proper forum. Admittedly, in terms of Sub- Section (2) to Section 35EE of the Act, the revision could be filed within a period of 3 months and the condonable period is further period of 3 months. The petitioners revision was filed within 3 months and 14 days, therefore, the delay of 14 days being not an inordinate delay, the revisional authority could have considered the petitioner's plea and entertained the revision and considered the claim on merits.
17. In the light of the above reasonings, the order passed by the revisional authority stating that the revision petition is beyond the condonable period in terms of Section 35EE of the Central Excise Act is incorrect in the light of the facts stated above.
18. In the result, the writ petitions are allowed and the impugned orders are set aside and the delay in filing the revision petitions are condoned subject to the condition that the petitioner deposits a further sum of Rs.2,50,000/- (Rupees Two Lakhs and Fifty thousand only) before the Deputy Commissioner of Central Excise, No.1, Vallalar Nagar, Manjakuppam, Cuddalore, within a period of four weeks from the date of receipt of a copy of this order along with the payment receipt and the copy of this order. Payment receipt and the copy of this order shall be filed before the first respondent, thereafter, the first respondent shall issue adjudication notice to the petitioner fixing the date of personal hearing and after hearing the petitioner, the first respondent shall consider and dispose of the matter on merits. No costs. Connected MPs are closed.
07.11.2014 Index:Yes Internet:Yes nvsri Note:Issue order copy on 18.11.2014 To
1.The Revision Authority Joint Secretary to the Government of India Ministry of Finance (Department of Revenue) 14, Hudco Vishala Building, B-Wing New Delhi-110 066
2.Customs, Excise and Service Tax Appellate Tribunal South Zonal Bench Shastri Bhavan Annexe Chennai-600 006
3.The Commissioner of Central Excise (Appeals) 26/1, Mahatma Gandhi Road Chennai-600 034
4.The Deputy Commissioner of Central Excise No.1, Vallalar Nagar, Manjakuppam, Cuddalore
5.The Additional Commissioner of Central Excise Breach Road, Pondicherry-604 001 T.S.SIVAGNANAM, J.
nvsri Writ Petition Nos.19179 and 19180 of 2013 07.11.2014