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Corporate News *  Service tax penalty can’t survive when assessee acted on dept.’s own view of non-taxability: Delhi High Court. *  GST section 74 extended limitation questionable when form 26AS mismatch was already known: Karnataka High Court grants interim relief. *  CGST demand prima facie impermissible after state GST settlement under section 128A: Bombay High Court. *  Supreme Court asks GSTAT to sympathetically consider delay as taxpayers pursued remedy before wrong forum. *  Supreme Court stays Tripura High Court ruling protecting genuine buyers from ITC denial over supplier’s GST default. *  Diary entries alone can’t prove clandestine removal of goods: CESTAT quashes excise penalty on steel trader. *  Customs could investigate preferential tariff claims even before sec. 28DA: Delhi High Court. *  Customs dept. relied on fake AI generated case laws: supreme court quashes Rs. 425.28 crore penalty. *  No GST exemption in affiliation and annual registration charges for admission or conduct Of examinations: GSTAT. *  Mere invoices, cheque payments insufficient to establish genuine movement of goods: GSTAT restores Rs. 43.44 lakh ITC demand. *  Consolidated GST show cause notice covering multiple financial years is not without jurisdiction: Delhi High Court. *  Construction of independent houses on separate plots not taxable as ‘Residential Complex’ without common facilities: CESTAT. *  GST penalty exceeding statutory maximum unsustainable; Allahabad High Court quashes ? 50,000/- penalty after taxpayer filed return and paid late fee. *  GST order against standard chartered bank passed without hearing set aside by Bombay High Court. *  Retracted statements can’t be relied upon without cross-examination: CESTAT quashes gold confiscation. *  Burden to prove misclassification lies on customs department: CESTAT. *  CESTAT quashes Rs. 98 lakh excise demand on clearance of used refractory brick scrap. *  Service tax demand on irrigation works quashed: Karnataka High Court rules sale of goods component not taxable as service. *  GSTAT restores tax and penalty for transporting iron scrap without E-way bill citing intent to evade tax. *  Madras High Court stays GST recovery from directors without opportunity to show cause under section 89. *  Madras high court stays GST recovery notice against directors; finds prima facie case on applicability of section 79(1)(c). *  Procedural lapses can’t justify harsh punishment without serious customs breach: CESTAT quashes customs broker licence revocation. *  Service tax payable on land leasing and sports complex charges: CESTAT. *  Settled customs dispute can’t be reopened through Article 226 challenge to interest liability: Delhi High Court. *  Mere facilitation of customs clearance can’t establish knowledge of smuggling: Madras High Court. *  GST registration cancellation stayed: Allahabad High Court questions 99% ITC utilisation cap under rule 86B. *  Composition scheme lapses automatically on crossing Rs. 1.5 crore turnover: GSTAT. *  Gujarat High Court quashes GST cancellation orders after officer relied on non-existent AI-generated case laws. *  Importers liable for customs duty benefits availed through manipulated scrips: Delhi High Court. *  Procedural E-way bill lapse alone can’t justify penalty where genuine transaction and absence of tax evasion are established: GSTAT.
Subject News *  Documentary evidence dominates probe, further custody unwarranted: mumbai court grants bail in Rs. 22.44 crore customs duty evasion case. *  Business premises can’t remain sealed for non-participation in GST search: Allahabad High Court. *  GST pre-deposit must be refunded proportionately when taxpayer partly succeeds in appeal: Bombay High Court. *  Supreme Court grants 30 days to file GST appeal; keeps pre-deposit issue open due to deposit in parallel CGST proceedings. *  GST demand can’t exceed amount proposed in SCN: Allahabad High Court quashes Rs. 20.47 Crore order. *  Hundreds-of-crores GST demand and heavy 10% pre-deposit no ground to bypass statutory appeal: Punjab & Haryana High Court. *  Delhi High Court refuses to entertain challenge to gold confiscation due to statutory appeal remedy and unexplained delay. *  Procedural error in customs broker licence inquiry can be rectified through remand: Delhi High Court. *  GSTR-2A mismatch alone can’t justify ITC denial without invoice-wise verification; personal hearing mandatory: GSTAT. *  GST order passed without uploading personal hearing notices violates sec. 75(4): Allahabad High Court. *  TAX EVASION - Sec. 74 GST SCN quashed for not spelling out fraud, wilful misstatement or suppression: Allahabad High Court. *  STPI’s SOFTEX certification and NoC charges taxable as business support services: CESTAT. *  Suspicion can’t replace proof: CESTAT quashes penalty in alleged gold-smuggling operation. *   Limitation runs from communication of order: Madras High Court upholds rejection of delayed GST Appeals. *  Rajasthan High Court quashes GST demand over unsigned show cause notice. *  ITC recovery upheld where supplier failed to deposit GST: Rajasthan High Court. *  Customs commissioner’s empowered to make port trust liable for duty on pilfered goods: Supreme Court. *  Rectification proceedings can’t be used to challenge an uncontested GST assessment through a writ petition: Andhra Pradesh HC. *  GST proceedings against deceased proprietor unsustainable without notice to legal heir: GSTAT. *  Mere availment of ineligible self-assessed ITC doesn’t amount to suppression without evidence of fraud or wilful misstatement: GSTAT. *  Disposal of mining overburden by entity authorised by mining lease holder constitutes taxable service: CESTAT. *  Toll plaza data not mandatory for ITC refund: GSTAT. *  Disputed GST fraud allegations require investigation: Punjab and Haryana High Court makes interim bail absolute in alleged fraud and GST fraud case. *  Non-manufacturer contractor liable to deposit excess excise duty collected from buyer: CESTAT. *  GST order can’t reject taxpayer’s reply as “not satisfactory” without reasons: Madhya Pradesh High Court. *  Uncorroborated statements can’t establish alleged diversion of duty-free goods: CESTAT. *  Erection services were not liable to service tax prior to 10th september 2004: CESTAT. *  Sec. 74 GST notice must spell out statutory ingredients for invoking extended tax demand proceedings: Allahabad High Court. *  No jurisdictional bar under section 6(2)(b) in parallel CGST SGST proceedings: Delhi High Court refuses to bypass GST appeal remedy. *  Madras High Court remits GST demand for fresh adjudication after taxpayer claims it was unaware of SCN following business closure.  

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PJ/Case Laws/2011-12/1354

Condonation of delay

Case: SHAHUL TEXTILES MILLS (P) LTD. versus CESTAT, CHENNAI
 
Citation: 2011 (271) E.L.T. 179 (Mad.)
 
Issue:- Condonation of delay – Order passed in 2004 but received on 27.09.2008 – appeal filed on 06.01.2009 after delay of 10 days – whether there is inordinate delay in filing appeal?
 
Brief Facts:- Appellant was engaged in the manufacture of cotton yarn. According to Revenue the appellant were clandestinely re­moving the manufactured cotton yarn without payment of duty by wrongly availing the exemption under Notification No. 1/93 as amended. Fur­ther allegation levied was that the appellant was using bogus invoice for clearing the goods without payment of duty. It was also alleged that the appellant had cleared the cotton yarn over and above the exempted limit of Rs. 30, 00,000/-.
 
The Adjudicating Authority determined the amount of duty payable by the appellant to be a sum of Rs. 69,370/. An equal amount by way of penalty plus Rs. 5,000/- was imposed under Rules 9(2), 52A and 173-Q of the Central Excise Rules, 1944 and Section 11AC of the Central Excise Act, 1944.
 
Appeal before the Commissioner (Ap­peals) was dismissed on 6-1- 2004. Appellant received the order on 27.09.2008.
 
Appellant preferred further appeal before the Tribunal on 6-1-2009. Since the appellant had 90 days time to file the appeal and the appeal was filed only on 6-1-2009, there was a delay of 10 days in filing the appeal. The Tribunal rejected the application for condonation of delay, passed the impugned order stating that there was inordinate delay in pur­suing the appeal.
 
Against the said order, appellant is before the High Court.
 
Appellant’s Contention:- According to the appellant, since its unit was closed, the appellant did not have the opportunity before the Commissioner (Appeals) and no notice was also served on the appellant.
 
It is also the case of the appellant that even the or­der copy dated 6-1-2004, passed in Appeal was received by the appellant only on 27-9-2008. And as 90 days time was available to them, they had filed appeal on 06.01.2009 but there was delay of 10 days in filing appeal.
 
Reasoning of Judgment:- The High Court held that in the said circumstances, if the order dated 6-1-2004 was served on the appellant only on 27-9-2008, it cannot be held that there was any delay beyond 10 days as has bean stated in the order passed in the application for condonation of delay. The reason adduced by the appellant was due to the closure of the Mills, it took some time for gathering materials for filing the appeal, which cannot be held to be not a justifiable reason. Certainly, it cannot be held that there was inordinate delay in filing the appeal. Inasmuch as going by the date of receipt of the order and the time allowed for filing the appeal, the delay was only 10 days in filing the appeal before the Tribunal, the HC does not find any justification in the order passed by the Tribunal in having rejected the appellant's appeal on the ground of inordinate delay. The impugned order is therefore, set aside. Tribunal directed to admit appellant’s file as well as dispose of stay application in accordance with law.
 
Decision:- Appeal allowed.
 
Comment:- This decision clearly held that the time limit is to be computed from the date of communication of order. Since the unit was closed and hence the order cannot be communicated, when it was communicated the appeal was filed.

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