Condonation of delay - Limited power to Commissioner (Appeals)
CASES under Customs/Central Excise/Service Tax involving duty up to Rs 50 lakhs are adjudicated by the officers of the rank up to Additional Commissioner. An appeal against such orders passed, by an officer below the rank of Commissioner lies before the Commissioner (Appeals).Thus, in respect of relatively small and medium scale units, the first appellate forum is the Commissioner (Appeals). As per the existing provisions of Customs Act, 1962, Central Excise Act, 1944 and Finance Act, 1994, time limit for fling appeals before the Commissioner (Appeals) is sixty days in case of Central Excise (Sec 35) and Customs (Sec 128) and two months in case of Service Tax (Sec 85(3A)). If there is a delay in filing appeal before the stipulated time, the Commissioner (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of sixty days/two months, allow it to be presented within a further period of thirty days / one month as the case may be.
Thus, including the condonable delay, the maximum time limit for filing appeal is ninety days/ three months. What happens if the appeal could not be filed within ninety days/three months? It the end of the story for the assessee. Nothing on earth can save him. Not even the Supreme Court. In the case of Singh Enterprises, (), which is widely followed in such disputes, the Supreme Court held:
The proviso to sub-section (1) of Section 35 makes the position crystal clear that the appellate authority has no power to allow the appeal to be presented beyond the period of 30 days. The language used makes the position clear that the legislature intended the appellate authority to entertain the appeal by condoning delay only upto 30 days after the expiry of 60 days which is the normal period for preferring appeal. Therefore, there is complete exclusion of Section 5 of the Limitation Act.
It will be interesting to note that in case of appeals to be filed before the CESTAT and the High Court, there is no limit for condonation of delay. Irrespective of the length of delay, the Tribunal or High Court are vested with powers to entertain the appeals if sufficient cause is shown for condonation of delay.
But, is it not an anomaly when big ticket demands, confirmed by the Commissioners enjoy unlimited condonation at the Tribunal whereas small and medium scale units' fate is sealed after three months? In fact, being hit with demands for the first time, these small units, which do not have separate personnel taking care of legal matters, take some time to find out the next course of action and to join the appeal stream. Unfortunately, many assessees are not aware of the seriousness of limitation and by the time they realise, the valuable three months' time would expire and they are stuck with the demands having no forum to fight their case on merits.
Why can't be the law amended so that the Commissioner(Appeals) are also allowed to condone the delay without any limit, as in the case of Tribunal and High Courts? As Supreme Court observed (), "After all, justice can be done only when the matter is fought on merits and in accordance with law rather than to dispose it of on such technicalities and that too at the threshold".