ntn header logo - Information on Uttar Pradesh Value Added … NTN DX 352.pdf · 2014-08-07 · [ALLAHABAD HIGH COURT] Hon'ble Ashok Bhushan, ... ‘Pending Dispute’ defined –

Copy Right: P & M Technologies : Email.: [email protected]

2013 52 NTN DX 352 [ALLAHABAD HIGH COURT]

Hon'ble Ashok Bhushan, and Hon'ble Prakash Krishna, JJ. Writ Tax No. - 711 of 2012

Paliwal Glass Works vs.

Union of India And Others

Date of Decision : 01st June, 2012 For the Petitioner : Sh. Rahul Agarwal, Advocate For the Respondent : Sh. S. P. Kesarwni, Sr. S.C.

[A] Appeal – Defective Appeal - admissibility - “whether a time barred appeal can be said to be pending and pendency can be negated on the ground that it was filed beyond time?” - Central Excise Rules 1944 Rule 57CC – New Rule 57CCC of Central Excise Rules, 1944 inserted – got assent of the President on 08/05/2010 - Central Excise Act, 1944 Section 35, Section 35-A, Section 35B discussed – Powers of Commissioner Central Excise (Appeals) for condoning delay – Tribunal condoned the delay but maintained dismissal order of CCE (Appeals) – At the date new rule 57CCC (supra) got assent, the dispute was pending – ‘Pending Dispute’ defined – High Court – on appraisal of various judicial pronouncement – held – “ it is clear that the proposition is undisputed that even if appeal is filed beyond time, the said appeal is to be treated as an appeal pending and merely because the appeal is beyond time, it cannot be treated as no appeal.”

[B] Words and Phrases – ‘Dispute’ - High Court – relied on the decision of the Apex Court in Canara Bank vs National Thermal Power and others (2001) 1SCC 43 – held - The word “dispute” as defined, clearly encompass within it a pendency of any litigation or claim of one party against the department.

l. Date Particulars Remarks

23/9/1998.

Due to non-maintenance of segregating accounts a show cause notice was issued to the petitioner

the petitioner was liable to reverse Rs.9,28,815/- as

the duty payable.

24/2/2000

demand was confirmed by the order passed by the DC, CE, Agra

a penalty of Rs. 1 lac was also imposed.

23/03/2000

The orders of the original authority have been passed on various dates of namely, 23.3.2000, 28.01.2002, 10.03.2000, 27.04.2000, 03.02.2000 and 08.01.2002.

The Department has

claimed that these orders have been dispatched

in the normal course by post

13/08/2003

Original Order received by the Petitioner

As per acknowledgement on record.


21/10/2004

petitioner filed a time barred appeal before the CCE(Appeals) Kanpur.

19/1/2006.

Appeal rejected by CCE (Appeals) Kanpur.

as barred by time.

Petitioner preferred a second appeal before the CESTAT, New Delhi. Tribunal Condone the delay in filing appeal

registered as Appeal No.2828/2009. Also the Petitioner deposited the amount to satisfy the aforesaid demand.

By Finance Act, 1910 (hereinafter called the (“Act,1910”) CER, 1944 (hereinafter called the (“Rules,1944”) were amended by inserting new Rule 57CCC.

08/05/2010

The Act, 2010 received the assent of the President.

on which date the petitioner's Appeal No.2828/2009

was pending before the CESTAT.

0 02/0

7/2010 Petitioner made an

application under Section 69(2) of the Act, 2010 read with Rule 57CCC of the Rules, 1944 before the CCE, Kanpur praying that the option exercised by the petitioner be accepted to pay the amount in accordance with the provisions of Rules,1944 as amended by sub-section (1) of Section 69 of the Act, 1910 and since the amount has already been paid, the case be settled finally.

The petitioner also made an application for refund of the

amount of Rs.10,28,815/- made by him to the DCCE, Agra Division.

1 12/0

7/2010 Appeal No.2829/2009

dismissed by Tribunal Petitioner

files appeal under section 35G

2 07/4

/2011 Petitioner receives a letter

from the AC CE by which it was informed that the petitioner's application shall be processed after the outcome of the appeal filed in the CESTAT or the requirement under sub-section

(2) of Section 69 of the Act, 1910 is meted out whichever is earlier.


3 Petitioner sent a reminder to decide his application

dated 02/7/2010 and thereafter has come up in this Court praying for the reliefs:

4 10/0

5/2012 Appeal (Defective) No.104

of 2011, under section 35G dismissed by the Division Bench of High Court.

The above table of date wise events gives a clear picture of the controversy and issues involved in the present writ petition.

The main contention of the petitioner is that his Appeal No.2828/2009 was pending on the date when the Act, 2010 was assented, hence the petitioner was entitled to take the benefit of Rule 57CCC and the application submitted by the petitioner on 02/7/2010 required to be decided on merits. The relief cannot be rejected outright only for some defect/delay in the filing of the appeal.

On the other hand the contentions of the learned counsel for the respondents submitted that the petitioner is not entitled for the benefit of amendment as brought by Section 69 of the Act, 2010 for the reason that the Rule 57CCC contemplates consideration of the application where dispute relating to adjustment of credit on inputs used is pending. Whereas in the case of petitioner no dispute was pending on the date when the Finance Act, 2010 received the assent of the President. He submits that the dispute came to an end when the Deputy Commissioner, Central Excise confirmed the demand by order dated 24/2/2000 and the appeal against such order was barred by time beyond four days hence the appeal could not have been entertained and has rightly been dismissed. The appeal filed by the petitioner before the Commissioner, Central Excise after several years of the adjudication order cannot be treated to be an appeal, nor the dispute can be treated to be pending.

Questions before High Court -

(i) Whether the appeal filed before the Commissioner of Central Excise (Appeals) under Section 35 of the Act 1944 beyond the period of two months which is provided as limitation for filing an appeal and beyond the further one month period during which the Commissioner could have condoned the delay, shall be treated to be a non est appeal? Held – No.

(ii) Whether time barred appeal filed before the Tribunal being Central Excise Appeal No.2828 of 2009 can be treated as pending on the day assent was given to the Finance Act, 2010 i.e. 8th May, 2010?

Held - Yes. Held: There can not be any quarrel to the fact that when an appeal by an assessee is pending before the appellate authority or a Tribunal it has to be conceded that the dispute is pending. The Provisions of Section 35, 35A and 35B cannot be read in a manner so as to exclude the appeal before the Tribunal against the order of Commissioner (Appeals) rejecting the appeal as barred by time. Thus an order passed in appeal rejecting the appeal as barred by time is also an order passed in appeal. Judicial decisions discussed and followed. Appeal filed beyond time can be treated to be pending. Reliance placed on the decision of the Apex Court in the case of Mela Ram and Sons vs. Commissioner of Income Tax reported in (1956)029 ITR 0607.

(iii) Whether the pendency of time barred appeal before the Tribunal can be treated to be pendency of dispute within the meaning of Rule 57CCC ?

Held – Yes. Yes, Rule 57CCC speaks of dispute and pendency of dispute.

The relevant words used in Rule 57CCC are “ Where a dispute relating to ... is pending”. Rule 57CCC does not refer to pendency of appeal or revision rather it uses a word of wider connotation i.e. “a dispute”. The definition of ‘dispute’ and pendency considered.


Decision of High court – “ by adjudicating authority directing for payment of duty amounting to Rs. 9,28,815.00 was disputed by filing an appeal. When an order passed by the adjudicating authority is challenged by an aggrieved party he is obviously disputing the order and his action of filing a time barred appeal either before Commissioner Central Excise (Appeals) or before the Tribunal has to be treated as raising a dispute and appeal before the CESTAT being appeal No. 2828 of 2009 pending on the relevant date, it has to be accepted that the dispute was pending on the relevant date.

Thus, we are of the view that the application dated 2.7.2010 filed by the petitioner to take benefit under section 69(2) of the Finance Act, 2010 read with Rule 57CCC cannot be said to be non entertainable on the ground that no dispute was pending on the relevant date i.e. on 8.5.2010.

Writ Petition is disposed of with a direction to the respondent no. 2 to consider the application dated 2.7.2010 submitted on 5.7.2010 by the petitioner under section 69(2) of the Finance Act 2010 read with Rule 57CCC of the Rules expeditiously.

Cases referred: Collector, Land Acquisition Anantnag and another vs. MST, Katj & others reported in 1987 (28) ELT 185 (SC)…………………………………361 Mela Ram and Sons vs. Commissioner of Income Tax reported in (1956) 029 ITR 0607……………………………………………………………….363 Raja Kulkarni vs. State of Bombay reported in A.I.R. 1954 SC 73…364 Lukkose John Thoppil vs. Commissioner of Income Tax reported in (2000) 242 ITR 1…………………………………………………………………….365 Gufic Pharma Ltd. vs. J. G. Arora [1999] 238 ITR 835…………..……365 Dr. Renuka Datla (Mrs.) and others vs. Commissioner of Income Tax, Karnataka and another reported in (2003) 2 SCC 19……………………366 Janki Das Lachchmi Narain vs. Commissioner of Income Tax and another reported in (2005) 274 ITR 155……………………………………..366 Commissioner of Income Tax, Rajkot vs. Shatrusailya Digvijaysingh Jadeja reported in (2005)7 SCC 294……………………………..…………….366 Tirupati Balaji Developers (P) Ltd. vs. State of Bihar & Others reported in (2004) 5 SCC 1………………………………………………………368 Swan Mills Ltd. vs. Union of India and others reported in (2007)7 SCC 29………………………………………………………………………………………..368 State of Tamil Nadu vs. K. Damodarasamy Naidu & Bros and another [2007] 10 VST 716………………………………………………………369 Better Label Manufacturing Co. Ltd. vs. Commissioner of Custom 2008 (228) E.L.T. 331……………………………………………………………………..369 Sheela Ashok Kumar Goenka vs. Designated Authority [2010] 326 ITR 402………………………………………………………………………………………369 Shatrushailya Digvijaysingh Jadeja vs. CIT, [2003] 259 ITR 149 (Guj)………………………………………..……………………………………………370 Commissioner of Income Tax vs. Shastrusailya Digvijaysingh Jadeja, [2005] 277 ITR 435 (SC) ………………………………………………370 Singh Enterprises vs. CCE, Jamshedpur and Ors. 2008 (221) ELT 163…………………………………………………………………………………..….371 Raja Mechanical Co (P) Ltd vs. Commissioner of Central Excise, Delhi-I, 2012 (279) E.L.T. 481 (S.C.)………………………….………………………371 Canara Bank vs National Thermal Power and others (2001) 1SCC 43………………….…………………………………………………………………….372

JUDGMENT


(Hon'ble Ashok Bhushan, J.)

Heard Shri Rahul Agarwal, learned counsel for the petitioner and Shri S.P. Kesarwani, learned counsel appearing for the respondents.

Brief facts of the case as emerge from the pleadings of the parties are: The petitioner was manufacturing glass and glassware. The raw material used by the petitioner in its process of manufacture was cullet and other waste scrap of glass, soda ash etc. The petitioner was availing Modvat Credit facility in respect of various inputs. The final products manufactured by the petitioner were both dutiable as well as exempt products, manufactured in the same assembly line using the same inputs. Since it was not possible to segregate the amount of inputs used in the manufacture of exempted as well as dutiable products, the petitioner used a ratio of total manufacture of exempted final product and dutiable final product to the total input used to determine how much of input was being used in the manufacture of exempted product and how much of input was being used in the manufacture of duitable product. That the petitioner had been declaring the same in its books as well as its return filed with the Central Excise Department. The Department had been accepting the same. That on scrutiny of quarterly RT12 return filed by the petitioner for the period December 1997 to August 1998, it was observed by the Central Excise Officer that the petitioner had availed Modvat Credit in respect of inputs such as cullet and other waste of glass falling under Tariff Heading 7001.10 and used the same in the manufacture of exempted final products as well as duitable final products. It was also noticed that the petitioner had been reversing the Modvat Credit utilized on the total inputs on a prorata basis depending the weight of duitable and exempted final products. The petitioner had therefore, reversed a total amount of Rs.5,473/- of Modvat Credit out of total Rs.40,045/- credit availed, being the Modvat Credit arising out of the use of inputs in exempted final products. However, separate accounts as envisaged under Rule 57CC of the Central Excise Rules, 1944 were not maintained. Due to non-maintenance of segregating accounts a show cause notice was issued to the petitioner on 23/9/1998. According to the show cause notice, the petitioner was liable to reverse Rs.9,28,815/- as the duty payable. The above demand was confirmed by order dated 24/2/2000, passed by the Deputy Commissioner, Central Excise, Agra and a penalty of Rs. 1 lac was also imposed. The petitioner filed a time barred appeal before the Commissioner of Central Excise (Appeals) Kanpur which was rejected on 19/1/2006. Against the aforesaid order, the petitioner preferred a second appeal before the CESTAT, New Delhi which was registered as Appeal No.2828/2009. Petitioner deposited the amount to satisfy the aforesaid demand.

By Finance Act, 1910 (hereinafter called the (“Act,1910”) Central Excise Rules, 1944 (hereinafter called the (“Rules,1944”) were amended by inserting new Rule 57CCC. Rule 57CCC provides as under:

“Rule 57CCC-Reversal of Actual Credit.—

Where a dispute relating to adjustment of credit on inputs used in or in relation to exempted final products relating to the period beginning on the 1st day of March, 1997 and ending with the 31st day of March, 2000 (both days inclusive) is pending on the date on which the Finance Bill, 2010 receives the assent of the President, then, notwithstanding anything contained in sub-rules (1) and (2) of rule 57C and sub-rule (1) and sub-rule (9) of rule 57CC, a manufacturer availing credit of specified duty in respect of any inputs, other than inputs used as fuel, and manufacturing final products which are chargeable to duty and also other final products which are not so chargeable to duty, shall pay an amount equivalent to such credit attributable to inputs used in, or in relation to the manufacture of, such final products which are not chargeable to duty, before or after the clearance of such goods :


Provided that the manufacturer shall pay an interest at the rate of twenty-four per cent per annum from the date of clearance of goods till the date of payment of the said amount."

The Act, 2010 received the assent of the President on 08/5/2010, on which date the petitioner's Appeal No.2828/2009 was pending before the CESTAT. The petitioner made an application under Section 69(2) of the Act, 2010 read with Rule 57CCC of the Rules, 1944 before the Commissioner, Central Excise, Kanpur praying that the option exercised by the petitioner be accepted to pay the amount in accordance with the provisions of Rules,1944 as amended by sub-section (1) of Section 69 of the Act, 1910 and since the amount has already been paid, the case be settled finally. The said application was submitted on 02/7/2010. A certificate by Chartered Accountant was also submitted by the petitioner. The petitioner also made an application for refund of the amount of Rs.10,28,815/- made by him to the Deputy Commissioner, Central Excise, Agra Division. Certain queries which were raised by the Deputy Commissioner, Central Excise, Agra as well as by the Superintendent, Central Excise were replied by the petitioner. A letter dated 07/4/2011 was received from the Assistant Commissioner, Central Excise informing the petitioner that the petitioner's application shall be processed after the outcome of the appeal filed in the CESTAT or the requirement under sub-section (2) of Section 69 of the Act, 1910 is meted out whichever is earlier. Petitioner sent a reminder to decide his application dated 02/7/2010 and thereafter has come up in this Court praying for the following reliefs:

“(a) issue a writ, order or direction in the nature of Mandamus directing the respondent No.2 to exercise its power under Section 14 of the Central Excise Act, 1944 and summon the books of accounts of the petitioner or accept the figures mentioned in the demand order dated 24.2.2000 raised against the petitioner and decide the application dated 02.07.2010 submitted by the petitioner under Section 69(2) of the Finance Act, 2010 read with Rule 57CCC of the erstwhile Central Excise Rules 1944 within a period of 2 months.

(b) issue any other suitable writ, order or direction, which this Hon'ble Court may deem fit and proper in the facts and circumstances of the case.

(c) award costs of the petition to the petitioner throughout.”

Learned counsel for the petitioner further submitted that the Appeal No.2828/2009 filed by the petitioner was dismissed by the Tribunal vide order dated 12/7/2010, against which an appeal under Section 35G of the Act, was filed in this Court and which appeal has also been dismissed by the Division Bench of this Court vide order dated 10/5/2012.

Learned counsel for the petitioner in support of his writ petition submitted that the petitioner's Appeal No.2828/2009 was pending on the date when the Act, 2010 was assented, hence the petitioner was entitled to take the benefit of Rule 57CCC and the application submitted by the petitioner on 02/7/2010 required to be decided on merits. He submits that although initially the petitioner was informed that his application was not traceable, but the petitioner when gave details and proof of receipt of the application, the said objection was given up and the petitioner received correspondence from Central Excise Commissionerate, Kanpur, but the said application is still pending and has not yet been decided. It is submitted that the benefit as was made available by the amendments made in Section 69 of the Act, 2010 can very well be extended to the petitioner. He submits that the petitioner has also informed the respondents that the figures which were mentioned in the show cause notice submitted by the respondents themselves be accepted and on that basis the petitioner's application be decided, but the respondents having not decided the application of the petitioner, he has been left with no remedy except to approach this Court by filing writ petition.


Shri S.P. Kesarwani, learned counsel appearing for the respondents submitted that the petitioner is not entitled for the benefit of amendment as brought by Section 69 of the Act, 2010. He submits that the Rule 57CCC contemplates consideration of the application where dispute relating to adjustment of credit on inputs used is pending. He submits that no dispute was pending on the date when the Finance Act, 2010 received the assent of the President. He submits that the dispute came to an end when the Deputy Commissioner, Central Excise confirmed the demand by order dated 24/2/2000. He submits that the appeal which was filed by the petitioner against the order dated 24/2/2000 was barred by time beyond four days, hence the appeal could not have been entertained and has rightly been dismissed. He submits that the Commissioner under Section 35 of the Act, 1944 has jurisdiction to entertain the appeal only within 60 days of the order and under the proviso to Section 35 of the Act, at best he could have entertained the appeal within further 30 days and since the appeal was filed beyond 90 days, the appeal could not have been entertained and the dispute for all purposes came to an end when the demand was confirmed by the Deputy Commissioner, Central Excise dated 24/4/2000. He submits that the appeal filed by the petitioner before the Commissioner, Central Excise after several years of the adjudication order cannot be treated to be an appeal, nor the dispute can be treated to be pending, hence the benefit of Rule 57CCC cannot be made available to the petitioner and the application of the petitioner dated 12/7/2010 being not covered under Rule 57CCC, cannot be entertained and no direction need to be issued by this Court in this writ petition for deciding such application. He submits that the petitioner's appeal before the Commissioner, Central Excise, cannot be said to be pending since it was filed beyond the statutory period of limitation as provided under the Act, 1944.

Learned counsel for the parties relied on various judgments of the Apex Court and this Court and other High Courts which shall be referred to while considering the submissions in detail.

From the submissions made by learned counsel for the parties, as noted above, and the pleadings of the petitioner, following issues arise for consideration:-

(i) Whether the appeal filed before the Commissioner of Central Excise (Appeals) under Section 35 of the Act 1944 beyond the period of two months which is provided as limitation for filing an appeal and beyond the further one month period during which the Commissioner could have condoned the delay, shall be treated to be a non est appeal?

(ii) Whether time barred appeal filed before the Tribunal being Central Excise Appeal No.2828 of 2009 can be treated as pending on the day assent was given to the Finance Act, 2010 i.e. 8th May, 2010?

(iii) Whether the pendency of time barred appeal before the Tribunal can be treated to be pendency of dispute within the meaning of Rule 57CCC?

All the issues being interrelated, are being taken up together for consideration.

As noted above, the prayer in the present writ petition is to issue a direction to the Commissioner of Custom and Central Excise to decide the application dated 2nd July, 2010 submitted by the petitioner under Section 69(2) of the Finance Act, 2010 read with Rule 57CCC. The objection, which has been strenuously raised by Sri S.P. Kesarwani, learned counsel for the department is that the order of the adjudicating authority dated 24th February, 2000 had become final since the appeal before the Commissioner was filed beyond the time and even beyond the period up to which the Commissioner could have condoned the delay, hence no dispute can be treated to be pending to enable the consideration of application dated 2nd July, 2010 submitted by the petitioner.


To recapitulate the facts again, the order of the adjudicating authority was passed on 24th February, 2000 confirming the order directing the petitioner to reverse Rs.9,28,815/- as duty payable on clearing the exempted final products. Against the said order of the adjudicating authority, the appeal was filed in the year 2004 i.e. much beyond the period of three months. The Commissioner, Central Excise (Appeals) had dismissed the appeal on 19th January, 2006 as barred by time against which appeal was filed before the CESTAT, New Delhi and was registered as Appeal No.2828 of 2009. The appeal filed before the Tribunal was also delayed but the Tribunal vide order dated 12th July, 2010 although condoned the delay in filing the appeal before the Tribunal but dismissed the appeal by confirming the order of Commissioner, Central Excise (Appeals). The Tribunal upheld that Commissioner, Central Excise (Appeals) had no jurisdiction to condone the delay beyond 30 days after expiry of 60 days, hence the order of the Commissioner was perfectly justified. It is also relevant to note that against the order of the Tribunal dated 12th July, 2010 Central Excise Appeal was filed by the petitioner in this Court being Central Excise Appeal (Defective) No.104 of 2011, which appeals was also dismissed by this Court on 10 May, 2012. Copy of the order of the Division Bench of this Court dated 10th May, 2012 has been placed before us by learned counsel for the petitioner in which the relevant facts have been noticed. It is useful to note the order of the Division Bench dated 10th May, 2012 in which relevant facts were noticed, which were to the following effect:-

“These appeals under Section 35(G) of the Central Excise Act have been filed against the order of the Tribunal dated 12th July, 2010 by which the Central Excise Appeal No. 2828-2833 of 2009 has been dismissed affirming the order of the Commissioner rejecting the appeals as barred by time. Before the Commissioner (Appeals), Central Excise the appeals were filed on 21.10.2004 against 7 orders which were passed between 8th February, 2010 to 8th January, 2002.

The Commissioner recorded findings that appeals having been filed after two years, whereas they were required to be filed within 60 days of the communication of the order. The appeals are barred by time and the delay could have been further extended to 30 days only, the appeals were dismissed. Appeals were filed before the Tribunal, which were also delayed. The Tribunal by the order impugned although condoned the delay in filing the appeal before the Tribunal but while affirming the order of Commissioner, the Tribunal recorded findings which is quoted below:

"9. Now, the issue to be considered is whether there was delay in filing appeal before the Commissioner (Appeals) and whether the delay was within permissible limit of condonation of delay within the powers of the Commissioner (Appeals). The orders of the original authority have been passed on various dates of namely, 23.3.2000, 28.01.2002, 10.03.2000, 27.04.2000, 03.02.2000 and 08.01.2002. The Department has claimed that these orders have been dispatched in the normal course by post and in some cases, the orders were got served through Range Superintendent. Even if these were to be disbelieved, the Department has produced a communication from the appellant's firm signed by Shri Rajiv Kumar Paliwal seeking copies of the orders and acknowledgment that the same have been received on 13.08.2003. Under these?

circumstances, there could be no doubt, at least on 13.08.2003, the appellants were served with the orders of original authorities if not earlier. If the benefit of doubt is yet to be extended to the appellant, the same can relate to the period prior to 13.08.2003. Having held that the appellants have received the orders at least on 13.08.2003, it is noticed that the appeals have been filed only on 21.10.2004 before the Commissioner (Appeals). The delay in filing these appeals before the Commissioner (Appeals) is much beyond the powers of the Commissioner (Appeals) to condone the delay.


10. The submissions that the partner who received the orders was suffering from dementia and that the said partner was not entitled to receive the communication on behalf of the appellants' firm are not acceptable submissions.

As submitted by the learned DR, it has been settled by the Hon'ble Supreme Court in the case of Singh Enterprises vs. C.C.E., Jamshedpur reported in 2008 (221) ELT 163 (SC) that the Commissioner (Appeals) can condone the delay only upto 30 days after expiry of 60 days which is normal period for per preferring appeal. The judgment of the Hon'ble Supreme Court in the case of Collector, Land Acquisition Anantnag and another vs. MST, Katj & others reported in 1987 (28) ELT 185 (SC), has sought to be relied upon by the appellants. The said judgment cannot be applied to the facts of the present case. Therefore, the Commissioner (Appeals) rejecting these appeals as barred by time cannot be assailed."

Learned counsel for the appellant sought to contend that the person who had received the order, was not authorized to receive the communication. The findings have been recorded by the Tribunal that the date of receipt of the order i.e. 13th August, 2003 has to be accepted. The appeal was filed by same person that is R.K. Paliwal. The findings recorded by the Commissioner as well as the Tribunal that the appeals were barred by time are based on consideration of all relevant materials.”

The Finance Act, 2010 received the assent of the President on 8th May, 2010, which is the relevant date for applicability of Rule 57CCC. The relevant words under Rule 57CCC are “Where a dispute relating to adjustment of credit on inputs used in or in relation to exempted final products relating to the period beginning on the 1st day of March, 1097 and ending with the 31 day of March, 2000 (both days inclusive) is pending on the date on which the Finance Bill, 2010 receives the assent of the President.....” Thus the question to be answered is as to whether on the relevant date i.e. 8th May, 2010 in the present case “a dispute...... was pending”. The first issue is as to whether the appeal which was pending on 8th May, 2010 before the Tribunal can be treated to be an appeal pending since the said appeal was barred by time. There cannot be any quarrel to the fact that where an appeal by an assessee is pending before the appellate authority or a Tribunal it has to be conceded that the dispute is pending. Thus we will first consider the rival submissions of learned counsel for the parties on the issue as to whether appeal before the Tribunal can be treated to be pending or not.

The Appeal No.2828 of 2009 was filed before the CESTAT, New Delhi as a time barred appeal. Section 35 of the Central Excise Act, 1944 provides appeal to the Commissioner (Appeals). Section 35-A deals with procedure in appeal and Section 35B provides for appeals to the appellate Tribunal. Section 35 of the Act is as under:-

“SECTION 35. Appeals to Commissioner (Appeals).— (1) Any person aggrieved by any decision or order passed under this Act by a Central Excise Officer, lower in rank than a Commissioner of Central Excise , may appeal to the Commissioner of Central Excise (Appeals) hereafter in this Chapter referred to as the Commissioner (Appeals) within sixty days from the date of the communication to him of such decision or order :

Provided that 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, allow it to be presented within a further period of thirty days.

(1A) The Commissioner (Appeals) may, if sufficient cause is shown at any stage of hearing of an appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing:


Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.

(2) Every appeal under this section shall be in the prescribed form and shall be verified in the prescribed manner.”

Section 35A of the Act which deals with procedure in appeal provides that Commissioner (Appeals) shall give opportunity to the appellant to be heard. Section 35A(4) provides that order of the Commissioner (Appeals) disposing of the appeal shall be in writing. Section 35B(1)(b) contemplates filing of appeal against the order of the Commissioner (Appeals) under Section 35A. The order passed by the Commissioner (Appeals) rejecting an appeal as barred by time is also an order of the Commissioner which can be appealed before the Tribunal which is clearly delineated from the scheme of the Act. The provisions of Section 35, 35A and 35B cannot be read in a manner so as to exclude the appeal before the Tribunal against the order of Commissioner (Appeals) rejecting the appeal as barred by time. Thus an order passed in appeal rejecting the appeal as barred by time is also an order passed in appeal. This issue is no more res integra and has already been decided by the Apex Court in the case of Mela Ram and Sons vs. Commissioner of Income Tax reported in (1956) 029 ITR 0607. The Apex Court in the said judgment had occasion to consider a case under the Income Tax Act, 1922 where appeal before the Appellate Assistant Commissioner was filed beyond time. The Appellate Assistant Commissioner held that there was no sufficient cause for condoning the delay. The further appeal was filed under Section 33 before the appellate Tribunal. The argument was raised that no appeal lay before the Tribunal since the order refusing to condone the delay shall not be treated to be an order passed in appeal. The said contention was rejected and following was laid down by the Apex Court:-

“Learned counsel for the appellant disputes the correctness of the last observation that an order of the Appellate Assistant commissioner refusing to condone the delay is one under section 30(2), and contends that the only order that could be passed under that section was one excusing delay, and an order refusing to condone it will fall outside it, and that such an order could only be made under section 31. We find it difficult to accede to this contention. When power is granted to an authority to be exercised at his discretion, it is necessarily implicit in the grant that he may exercise it in such manner as the circumstances might warrant. And if the Appellate Assistant Commissioner has a discretion to excuse the delay, he has also a discretion in appropriate cases to decline to do so. We are therefore of opinion that the refusal to excuse delay is an order under section 30(2.).

But the question still remains whether the view taken in Commissioner of Income-tax vs. Mysore Iron and Steel Works (1) and K. K. Porbunder-walla vs. Commissioner of Income-tax (2) that an appeal which is filed beyond the period of limitation is, in the eye of law, no appeal, unless and until there is a condonation of delay, and that, in consequence, an order passed thereon cannot be held to be passed in appeal so as to fall within section 31 is right. Now, a right of appeal is a substantive right, and is a creature of the statute. Section 30(1) confers on the assessee a right of appeal against certain orders, and an order of assessment under section 23 is one of them. The appellant therefore had a substantive right under section 30(1) to prefer appeals against orders of assessment made by the Income-tax Officer. Then, we come to section 30(2), which enacts a period of limitation within which this right is to be exercised. If an appeal, is not presented within that time, does that cease to be an appeal as provided under section 30(1)? It is well established that rules of limitation, pertain to the domain of adjectival law, and that they operate only to bar the remedy but not to extinguish the right. An appeal preferred in accordance with section 30(1) must, therefore, be an appeal in the eye of law, though having been presented beyond


the period mentioned in section 30(2) it is liable to be dismissed in limine. There might be a provision in the statute that at the end of the period of limitation prescribed, the right would be extinguished, as for example, section 28 of the Limitation Act; but there is none such here. On the other hand, in conferring a right of appeal under section 30(1) and prescribing a period of limitation for the exercise thereof separately under section 30 (2), the legislature has evinced an intention to maintain the distinction well-recognised under the general law between what is a substantive right and what is a matter of procedural law. In Nagendranath Dey vs. Suresh Chandra Dey (3) Sir Dinshaw Mulla construing the word ' appeal' in the third column of article 182 of the Limitation Act observed:

"There is no definition of appeal in the Civil Procedure Code, but their Lordships have no doubt that any application by a party to an appellate, Court, asking it to set aside or revise a decision of a subordinate Court, is an appeal within the ordinary acceptation of the term, and that it is no less an appeal because it is irregular or incompetent".

These observations were referred to with approval and adopted by this Court in Raja Kulkarni and others vs. The State of Bombay (1). In Promotho Nath Roy vs. W. A. Lee (2), an order dismissing an application as barred by limitation after rejecting an application under section 5 of the Limitation Act to excuse the delay in presentation was held to be one "passed on appeal" within the meaning of section 109 of the Civil Procedure Code. On the principles laid down in these decisions, it must be held that an appeal presented out of time is an appeal, and an order dismissing it as time-barred is one passed in appeal.”

In an earlier judgment in the case of Raja Kulkarni vs. State of Bombay reported in A.I.R. 1954 SC 73, the Apex Court had laid down that appeal will be treated to be pending even though it is irregular or incompetent. Following was laid down by the Apex Court in paragraph 6 of the said judgment:-

6. It is contended that section 24 contemplates the pendency of a valid and competent appeal, but as no valid or competent appeal under the law was pending, the appellants committed no offence under section 27. We are unable to accept this contention. Section 24 on a plain and natural construction requires for its application no more than that an appeal should be pending and there is nothing in the language to justify the introduction of the qualification that it should be valid or competent.

Whether the appeal is valid or competent is a question entirely for the appellate court before whom the appeal is filed to determine, and this determination is possible only after the appeal is heard, but there is nothing to prevent a party from filing an appeal which may ultimately be found to be, incompetent, e. g., when it is held to be barred by, limitation or that it does not lie before that court or is concluded by a finding of fact under section 100 of the Civil Procedure Code. From the mere fact that' such an appeal is held to be unmaintainable on any ground whatsoever, it does not follow that there was no appeal pending before the court. Article 182(2) of the Indian Limitation Act prescribes three years period of limitation for the execution of a decree or order to run from the date of the final decree or order of the Appellate Court "when there has been an appeal." The Privy Council construed the latter phrase to mean that any application by a party to the appellate court to set aside or revise a decree, or order of a court subordinate thereto is an "appear, within the meaning of the above provision, even though it is irregular or incompetent, or the persons affected by the application to execute were not parties, or it did not imperil the whole decree or order. They refused, to read into the words any qualification either as to the character


of the appeal, or as to the parties to it. [Nagendra Nath Dey and Another vs. Suresh Chandra Dey and Others (1)].”

The Kerla High Court in the case of Lukkose John Thoppil vs. Commissioner of Income Tax reported in (2000) 242 ITR 1 had occasion to consider the question of pendency of revision in context of Section 95(c) of the Finance Act, 1998 with regard to Kar Vivad Samadhan Scheme. The contention was raised that revision was not maintainable, hence the benefit of scheme was not available. The Kerala High Court repelling the submission, laid down following:-

“Even otherwise, I am of the view that for the disposal of the declarations under the Kar Vivad Samadhan Scheme what is necessary is to find out whether there is a revision or appeal pending. Section 95 (c) of Chapter IV of the Kar Vivad Samadhan Scheme states that the provisions of this scheme shall not apply to a case where no appeal or reference or writ petition is admitted and pending before any appellate authority or the High Court or the Supreme Court on the date of filing of the declaration or no application for revision is pending before the Commissioner on the date of filing of the declaration. In this case, the revision petitions were filed on October 28, 1998. The declarations were filed on November 2, 1998. Thus, it cannot be said that the revision petitions were not pending on the date of filing of the declarations. The further question whether the revision petitions filed were maintainable or any reliefs could be granted in the revision petitions, according to me, is not relevant. The object of the scheme appears to be to put an end to litigation and also to see that the tax is collected from the assessee. According to me, to read the word "revision" in Section 95(c) of the Scheme as a revision which is maintainable or in which relief could be granted will be amounting to re-writing the Section. It is one of the cardinal principles of interpretation of statutes that unless there is an intention to the contrary, the words in a statute should be given their ordinary meaning. I derive support for this conclusion from the decision of the Gujarat High Court in Gufic Pharma Ltd. vs. J. G. Arora [1999] 238 ITR 835. There, the Gujarat High Court held as follows (page 841) :

"The mere fact that the revising authority also happens to be the designated authority, he cannot merge the two distinct jurisdictions and obligations into one and reflect one order into another. As a designated authority, he has jurisdiction to see only the existence of the conditions which make the Kar Vivad Samadhan Scheme operative in the case ..... whether the revision has merit or will be successful, is not his domain. That is the domain of the revising authority. That jurisdiction he may not be called upon to exercise if on determining the amount payable under the scheme the assessee deposits the same within the time prescribed. Because in such event the revision is deemed to be withdrawn under Section 90(4) of the Finance (No. 2) Act of 1998."

Section 95(c) of the Finance Act, 1988 again came for consideration before the Apex Court in the case of Dr. Renuka Datla (Mrs.) and others vs. Commissioner of Income Tax, Karnataka and another reported in (2003) 2 SCC 19. Following was laid down by the Apex Court in paragraph 19 of the said judgment:-

“19. However, not all "tax arrears" under Section 87(m) are entitled to the benefit of the scheme. If no appeal etc. is pending in respect of the tax arrears, the benefit of the scheme is not available under Section 95(1)(c). If an appeal etc. is pending, it is not for the designated authority to question the possible outcome of the appeals, nor for the High Court to hold that the appeal was "sham", "ineffective" or "in fructuous" as it has. In any event, the High Court erred in holding that the entire demand raised on 31st December 1998 had been


consented to by the appellant, in computing the demand on 31st December 1998 the assessing officer included not only those items which had been remitted by the CIT(A) for re-determination and which were conceded to by the appellant, but also the items which had been confirmed by the CIT(A) which had not been conceded and were the subject matter of appeal before the Tribunal. Thus the question of imposition of interest under Section 234A, 234B and 234C and the determination in respect of items (iii) and (vii) referred to above, even according to the High Courts view, was the subject matter of appeal. In the facts of the case therefore, it cannot be said that there was no appeal pending in respect of the tax arrears pertaining to those items within the meaning of Section 95(1)(c).”

A Division Bench of this Court had occasion to consider the question of “Admitted and Pending” in context of Section 95 of the Finance Act, 1998 in the case of Janki Das Lachchmi Narain vs. Commissioner of Income Tax and another reported in (2005) 274 ITR 155. After considering the earlier judgments, the Division Bench of this Court laid down following ratio in paragraph 30:-

“30. Thus from the aforesaid cases it is settled that an appeal in order to be pending must as a matter of fact be pending and it is immaterial as to whether it has been filed beyond time or is not in the prescribed form. Further it is not to be seen as to whether the appeal has any merit or not. In case the appeal has been filed beyond the period of limitation, in the event the application for condonation of delay has been allowed it will be treated as having been properly filed.”

The Apex Court had occasion to consider the meaning of word “pendency” as mentioned in Section 95(1)(c) of the Finance Act, 1988 in the case of Commissioner of Income Tax, Rajkot vs. Shatrusailya Digvijaysingh Jadeja reported in (2005)7 SCC 294. In the case before the Apex Court revisions were filed beyond time along with application for condonation of delay. The contention was raised that the revision cannot be treated to be pending. It was stated that appeals under Section 246 of the Income Tax Act stood dismissed in the year 1992-93 for failure to pre-deposit self assessed tax and the revision was filed much beyond the time which was also dismissed by the Commissioner subsequently for want of sufficient cause to condone the delay. The designating authority rejected the claim on the ground that revision was not pending, hence assessee was not entitled for benefit of Kar Vivad Samadhan Scheme. The decision was challenged in the High Court and the High Court set-aside the order of the designating authority against which revenue filed an appeal before the Apex Court. The Apex Court dismissed the appeal and held that revision has to be treated as pending. It is useful to quote paragraphs 6, 10, 11, 14, 15, 16 and 17:-

“6. On the above facts, the department's case before us is that the scheme was enacted to resolve the pending litigation; that the purpose of the scheme was not to create artificial pendency of litigation; that the revisions were not pending on 1.9.1998 when the scheme came into force as the revisions were filed in November and December, 1998 along with applications for condonation of delay and consequently, such revisions did not come within the meaning of the word "pendency" as mentioned in section 95(i)(c) of the said Scheme. On behalf of the department, it was further pleaded that under the IT Act, there was a difference between an appeal and a revision; that the remedy of filing an appeal is available to an assessee under section 246 as a matter of right whereas the remedy of filing revision under section 264 was a discretionary remedy. On facts, it was pleaded that the revisions filed by the assessee were not bonafide as the appeals under section 246 stood dismissed in the year 1992-93 for failure to pre-deposit self- assessed tax; that the revisions filed were also not bona fide as they were filed only to obtain the benefit of the said scheme; that the revisions were filed under section 264 before the commissioner after a long delay and they were rightly dismissed by the commissioner subsequently for want of sufficient cause to condone the delay.


10. The basic point which we are required to consider in this case is the meaning of the word "pending" in section 95(i)(c) of the said Scheme.

11. The object of the scheme was to make an offer by the Government to settle tax arrears locked in litigation at a substantial discount. It provided that any tax arrears could be settled by declaring them and paying the prescribed amount of tax arrears, and it offered benefits and immunities from penalty and prosecution. In several matters, Government found that large number of cases were pending at the recovery stage and, therefore, the Government came out with the said Scheme under which it was able to unlock the frozen assets and recover the tax arrears.

14. In the case of Dr. Mrs. Renuka Delta (supra), this Court has held on interpretation of section 95(i)(c) that if the appeal or revision is pending on the date of the filing of the declaration under section 88 of the Scheme, it is not for the DA to hold that the appeal/revision was "sham", "ineffective" or "infructuous" as it has.

15. In the case of Raja Kulkarni vs. The State of Bombay reported in AIR 1954 SC 73, this Court laid down that when a section contemplates pendency of an appeal, what is required for its application is that an appeal should be pending and in such a case there is no need to introduce the qualification that it should be valid or competent. Whether an appeal is valid or competent is a question entirely for the appellate court before whom the appeal is filed to decide and this determination is possible only after the appeal is heard but there is nothing to prevent a party from filing an appeal which may ultimately be found to be incompetent, e.g., when it is held to be barred by limitation. From the mere fact that such an appeal is held to be unmaintainable on any ground whatsoever, it does not follow that there was no appeal pending before the Court.

16. To the same effect is the law laid down by the judgment of this Court in the case of Tirupati Balaji Developers (P) Ltd. vs. State of Bihar & Others reported in (2004) 5 SCC 1, in which it has been held that an appeal does not cease to be an appeal though irregular and incompetent.

17. For the aforestated reasons, orders of the designated authority rejecting the declarations filed by the assessee are quashed. We do not find any infirmity, to this extent, in the impugned judgment of the High Court. The appeal is accordingly dismissed, with no order as to costs.

Again in the case of Swan Mills Ltd. vs. Union of India and others reported in (2007) 7 SCC 29, similar issue came for consideration as to whether appeal filed beyond time can be treated to be pending. In the said case the adjudication order was passed on 12th November, 1997 by the Assistant Commissioner of Central Excise confirming the demand. An appeal was filed before the Commissioner, Central Excise (Appeals) on 2nd September, 1998 along with the stay application. The Finance Act No.2 of 1998 came with a scheme, namely, Kar Vivad Samadhan Scheme. The appellant filed declaration on 31st December, 1998 before the Commissioner of Central Excise to take benefit of the scheme which declaration was rejected on the ground that appeal was filed before the Commissioner of Central Excise (Appeals) after the limitation for filing the appeal and the delay in filing the appeal was not condoned by the Commissioner of Central Excise (Appeals). The Tribunal on an appal against the order of Commissioner of Central Excise (Appeals) allowed the appeal and held that appeal was within time, set-aside the order of the Commissioner (Appeals) and remanded the matter back for fresh disposal. The Commissioner (Appeals) upheld the order in original which became final. The assessee deposited the duty demanded and subsequently when demand for interest was raised, a writ petition was filed where the benefit of Kar Vivad Samadhan Scheme was claimed. The High Court denied the benefit saying that the appeal was not pending. The Apex Court set-aside the judgment of the High Court and following the


earlier judgment in the case of CIT vs. Shatrusailya Digvijaysingh Jadeja (supra) held the appeal to be pending. It is relevant to quote paragraphs 6, 19 and 22 which are as under:-

“6. The aforesaid declaration filed by the appellant came to be rejected by the Designated Authority vide his order dated 25th February, 1999 on the ground that appeal was filed by the appellant before the Commissioner of Central Excise (Appeals) after the limitation for filing the appeal had already expired and that delay in filing the appeal was not condoned by the Commissioner of Central Excise (Appeals).

19. In support of the appeal, learned counsel for the appellant submitted that the Designated Authority erred in rejecting the declaration made under KVSS on the ground that the appeal preferred by the appellant on 2.9.1998 before the Commissioner (Appeals) was time barred and, therefore, it cannot be said that any appeal was pending under Section 95(ii)(c) of KVSS. The appeal dated 2nd September, 1998 in respect of order-in-original dated 12th November, 1997/15th May, 1998 was in time and it has been so held ultimately by the Tribunal. Therefore, the Designated Authority ought to have considered the matter. The High Court noted that the appellant kept quite and did not take steps in challenging the order dated 25th February, 1999 passed by the Designated Authority rejecting the declaration made by the appellant under KVSS for some time but filed an appeal against the order dated 25th February, 1999 passed by the Commissioner of Central Excise (Appeals) rejecting the appellant's appeal as time barred by filing an appeal before the Tribunal. By order dated 29th November, 1999 the Tribunal allowed the appeal setting aside the order passed by the Commissioner of Central Excise (Appeals) and remanded the matter to the Commissioner (Appeals).

22. The ratio in Shatrusailya's case (supra) is clearly applicable. In the instant case the appeal is to be treated as pending. The High Court was not justified in dismissing the writ petition. The impugned order of the High Court is set aside. Orders of the Designated Authority rejecting the declaration filed by the appellant are quashed. The appeal is allowed with no order as to costs.”

The judgment of the Madras High Court in [2007] 10 VST 716 State of Tamil Nadu vs. K. Damodarasamy Naidu & Bros and another and the judgment of the Madras High Court reported in 2008 (228) E.L.T. 331 Better Label Manufacturing Co. Ltd. vs. Commissioner of Custom also laid down the same proposition. The Gujrat High Court had occasion to consider again the question of pendency in [2010] 326 ITR 402 Sheela Ashok Kumar Goenka vs. Designated Authority. In the above case, the application of assessee under Kar Vivad Samadhan Scheme was rejected by stating that the revision application filed by the assessee was belated one. The declaration made by the assessee claiming the benefit under Kar Vivad Samadhan Scheme was rejected on the ground that the revision cannot be treated to be pending. Allowing the writ petition, the Gujrat High Court has observed as follows :

“ The facts which are not in dispute are that for the Assessment Year 1994-95, the petitioner-assessee sought set off of loss suffered in a proprietary business against other income as per return of income filed. However, as the books of account of the proprietary business could not be produced before the Assessing Officer, the petitioner agreed to withdraw the claim of loss. Accordingly, in the Assessment Order made on 31-03-1997, the claim of loss was disallowed by the Assessing Officer, and while doing so, the Assessing Officer held that the withdrawal of claim of loss by the petitioner could not be considered to be voluntary and bona fide. The Assessing Officer initiated penalty proceedings for concealment / furnishing of inaccurate particulars of income under Section 271 (1) (c) of the Act and levied penalty vide order 26-09-1997. The petitioner preferred Revision Application under Section 264 of Act


against the Assessment Order and such Revision Application was preferred on 23-01-1999 (the date, according to the respondent, being 28-01-1999). The petitioner also preferred an application seeking condonation of delay. During the pendency of the Revision Application and the accompanying application for condonation of delay, the petitioner made a declaration under KVSS for settling the dispute, both in relation to the tax and the penalty levied.

It is in this aforesaid background of facts that the Designated Authority has, while accepting the declaration insofar as penalty is concerned, rejected the declaration in relation to assessment by observing that in absence of any proceedings pending, the petitioner was not entitled to seek benefit under KVVS.

On behalf of the petitioner, it was submitted by the learned Senior Advocate that the issue was no longer res integra, as, in almost similar set of circumstances, this High Court in case of Shatrushailya Digvijaysingh Jadeja vs. CIT, [2003] 259 ITR 149 (Guj) came to the conclusion that there was no distinction between a proceeding which is pending, whether the proceeding has been initiated within a period of limitation, or beyond the period of limitation accompanied by an application seeking condonation of delay. That, the aforesaid view expressed by this High Court has been confirmed by the Apex Court in case of Commissioner of Income Tax vs. Shastrusailya Digvijaysingh Jadeja, [2005] 277 ITR 435 (SC).

The issue raised by the present petition, therefore, stands concluded in favour of the petitioner by virtue of ratio enunciated by the Apex Court on analysing the scheme of KVSS. It was not open to the Designated Authority to decide in the proceedings under KVVS whether the revision application was barred by limitation or not; or whether the delay was required to be condoned or not. The petitioner is, therefore, justified in claiming that the assessment also is required to be covered under KVSS and the declaration made by the petitioner in relation to disputed amount of tax is required to be accepted.”

From the ratio of the judgment as noted above, it is clear that the proposition is undisputed that even if appeal is filed beyond time, the said appeal is to be treated as an appeal pending and merely because the appeal is beyond time, it cannot be treated as no appeal. Sri S.P. Kesarwani, learned Counsel for the respondent tried to distinguish the above cases on the ground that in the cases which have been relied by learned Counsel for the petitioner, there was power to condone the delay hence, the appeals filed along with delay condonation application were treated to be pending whereas under section 35 of the Central Excise Act, 1944, there is no power with the Commissioner to condone the delay beyond one month after expiry of two months hence, the cases are distinguishable.

There are two reasons for which the above submission of Sri Keshwarwani cannot be accepted. Firstly; relevant date on which Finance Act, 2010 came into force was 8.5.2010 which is the relevant date to determine the pendency of a dispute. On relevant date 8.5.2010, the appeal was pending before the CESTAT being appeal No. 2828 of 2009 which was subsequently dismissed on 12.7.2010. The appeal before the Tribunal was also barred by time. The Tribunal has power to condone the delay in filing the appeal and there is no such limitation on the power of the Tribunal that it can condone delay of only one month as is provided for Commissioner in Central Excise Act in Section 35. Section 35B(3) provides for three months limitation for filing an appeal and subsection (5) provides for condonation of delay on sufficient cause. Section 35B(3) and 35B(5) are quoted below:

SECTION 35B. Appeals to the Appellate Tribunal. —(3) Every appeal under this section shall be filed within three months from the date on which the order sought


to be appealed against is communicated to the Commissioner of Central Excise , or, as the case may be, the other party preferring the appeal.

(5) The Appellate Tribunal may admit an appeal or permit the filing of a memorandum of cross-objections after the expiry of the relevant period referred to in sub-section (3) or sub-section (4), if it is satisfied that there was sufficient cause for not presenting it within that period.

Thus, the arguments of Sri Kesarwani that the cases relied by learned Counsel for the petitioner are not applicable, cannot be accepted. Secondly; when appeal is filed before the Appellate Tribunal it had jurisdictional power to set aside an order of Commissioner Central Excise Appeals including an order rejecting the appeal as barred by time. Thus, it cannot be said that the order of Commissioner dismissing the appeal as barred by time had ended the dispute and appeal before the Tribunal challenging the said order of the Commissioner cannot be treated to be “an appeal pending” Sri Kesarwani learned Counsel for the respondent had relying on the judgment of the supreme Court in Singh Enterprises vs. CCE, Jamshedpur and Ors. 2008 (221) ELT 163 submitted that Commissioner Appeal can condone the delay only upto 30 days after expiry of 60 days. There cannot be any dispute to the proposition as laid down by the apex Court in the case of Singh Enterprises (supra) but it cannot be denied that appellate tribunal can always set aside the order of Commissioner appeals and only because Commissioner appeals cannot condone delay beyond one month, submission cannot be accepted that any appeal filed beyond one month before Commissioner or any appeal filed against the order of Commissioner rejecting the appeal as barred by time, shall not be treated to be pending, if the same was pending on the relevant date. Sri Kesarwani has further relied on Raja Mechanical Co (P) Ltd vs. Commissioner of Central Excise, Delhi-I, 2012 (279) E.L.T. 481 (S.C.). The Apex Court in the said decision has laid down that an appeal is dismissed on the ground of limitation and not on merits, that order would not merge with the orders passed by the first appellate authority. Following was laid down in paragraph 12 by the apex Court in the aforesaid judgment:

“12. The question now that falls for our consideration and decision is whether the Tribunal was justified in not considering the case of the assessee on merits. The assessee's stand before the Tribunal and before this Court is that the orders passed by the adjudicating authority would merge with the orders passed by the first appellate authority and the Tribunal ought to have considered the appeal filed by the assessee on merits also. In our opinion, the same cannot be accepted. In view of the plethora of decisions of this Court, wherein this Court has, categorically, observed that if for any reason an appeal is dismissed on the ground of limitation and not on merits, that order would not merge with the orders passed by the first appellate authority. In that view of the matter, we are of the opinion, that the High Court was justified in rejecting the request made by the assessee for directing the revenue to state the case and also the question of law for its consideration and decision. In view of the above discussion,we do not find any merit in this appeal.”

There cannot be any dispute to the proposition as laid down in the above case by the apex Court but in the present case, we are not examining the question of merger. The issue to be considered is as to whether a time barred appeal can be said to be pending and pendency can be negated on the ground that it was filed beyond time.

There is one more aspect of the matter which clinches the issue. The relevant words used in Rule 57CCC are “ Where a dispute relating to …...... is pending”. Rule 57CCC does not refer to pendency of appeal or revision rather it uses a word of wider connotation i.e. “a dispute”. Word “dispute” has been defined in Concise Oxford English Dictionary as follows:


“1 argue about (something). Question the truth or validity of (a statement or alleged fact). 2 compete for. 3 archaic resist (a military landing or advance). A disagreement or argument. A disagreement between management and employees that leads to industrial action”

The apex Court in (2001) 1SCC 43 Canara Bank vs National Thermal Power and others had laid down following in paragraph 12:

“......The meaning of word "dispute" is, 'a controversy having both positive and negative aspects. It postulates the assertion of a claim by one party and its denial by the other.”

Black's Law Dictionary Sixth Edition defines dispute as follows:

“Dispute. A conflict or controversy; a conflict of claims or rights, an assertion of a right, claim, or demand on one side, met by contrary claims or allegations on the other. The subject of litigation; the matter for which a suit is brought and upon which issue is joined, and in relation to which jurors are called and witnesses examined.”

The word “dispute” has also been defined in Advanced Law Lexicon by P. Ramanatha Aiyar 3rd Edition as follows:

“Dispute.- A conflict or contest; sometimes used in the sense of controversy.

There would be a dispute so long as a claim is asserted by one party and denied by the other, be the claim a false or a true one, or whether it ultimately turns out to be false or true.

Whether or not the Court can legally enquire into any question on which the parties join issue is a dispute within the meaning of para I.”

The word “dispute” as defined above, clearly encompass within it a pendency of any litigation or claim of one party against the department. In the present case, the adjudication order passed by adjudicating authority directing for payment of duty amounting to Rs. 9,28,815.00 was disputed by filing an appeal. When an order passed by the adjudicating authority is challenged by an aggrieved party he is obviously disputing the order and his action of filing a time barred appeal either before Commissioner Central Excise (Appeals) or before the Tribunal has to be treated as raising a dispute and appeal before the CESTAT being appeal No. 2828 of 2009 pending on the relevant date, it has to be accepted that the dispute was pending on the relevant date. Thus, the very basis of submission of Sri Kesarwani to knock out the application submitted by the petitioner under Rule 57CCC is unfounded. Thus, we are of the view that the application dated 2.7.2010 filed by the petitioner to take benefit under section 69(2) of the Finance Act, 2010 read with Rule 57CCC cannot be said to be non entertainable on the ground that no dispute was pending on the relevant date i.e. on 8.5.2010. We however, make it clear that we have neither examined the merits of the claim of the petitioner in the application dated 2.7.2010 nor we are expressing any opinion on the merits of the application.

In the result of the foregoing discussions, the writ petition is disposed of with a direction to the respondent no. 2 to consider the application dated 2.7.2010 submitted on 5.7.2010 by the petitioner under section 69(2) of the Finance Act 2010 read with Rule 57CCC of the Rules expeditiously preferably within a period of three months from the date of filing of a certified copy of this order.

It is ordered accordingly.

………………………..


Documents

ntn header logo - Information on Uttar Pradesh Value Added … NTN DX 352.pdf · 2014-08-07 · [ALLAHABAD HIGH COURT] Hon'ble Ashok Bhushan, ... ‘Pending Dispute’ defined –