Whether Tribunal has power to condone delay under section 129A (5) of the Customs Act in respect of late application made by Commissioner under section 129D (4)?

PJ/Case Laws/2012-13/1330

CASE:M/s THAKKER SHIPPING P LTD V/S COMMISSIONER OF CUSTOMS (GENERAL)

CITATION:2012-TIOL- 105-SC-CUS

BRIEF FACTS:A container was intercepted by M& P Wing of Commissioner of Customs (Preventive), Mumbai on 11.01.2001. It was found to contain assorted electrical and electronic goods of foreign origin. The said goods were imported by M/s Qureshi International and the cargo was cleared from Nhava Sheva. The clearance of the goods was handled by M/s Thakker Shipping P. Ltd., the appellant, referred to as the Custom House Agent. On physical verification, the value of seized cargo was estimated at Rs. 77, 10,000/- as local market value as against the declared value of Rs. 10,03,690/-. The importer could not be interrogated. On search of premises of CHA, the books relating to import export clearance were not found for verification. In the statement of Vijay Thakker, proprietor of the CHA, recorded under Section 108 of the Customs Act, 1962, he accepted that he attended the import clearance work and introduced the importer to the overseas suppliers and bankers for financial assistance; the bill of entry for the clearance of subject goods had been filed without proper description and correct value and he failed to inform the Customs Officers about the subject goods, despite having attended the examination of 5% goods prior to the clearance. Accordingly, the inquiry officer recorded his findings.

The appellant's CHA licence was placed under suspension pending inquiry under Regulation 23 of Custom House Agent Licensing Regulations, 2004 but the suspension order was set aside by the Tribunal and CHA licence was restored. The inquiry under Regulation 23, however, proceeded against the CHA on diverse charges. The Commissioner of Customs (General) Mumbai by his order in original dated 21.07.2004 dropped the proceedings under Regulation 23 by rejecting the findings of the inquiry officer.
The Committee of Chief Commissioners of Customs constituted under sub section (113) of Section 129A of the Act called for and examined the records of the proceedings leading to order in original dated 21.07.2004 passed by the Commissioner of Customs (General) Mumbai for satisfying itself as to the legality and propriety of the said order. The Committee on consideration of the entire matter directed the Commissioner to apply to the Tribunal for determination of the following points namely (1) whether taking into consideration facts and circumstances noticed in the order, the order of the Commissioner was legally correct and proper; and (2) whether by an order under section 129B of the Act, the Tribunal should set aside the order of the Commissioner dropping the proceedings under CHA.
The Commissioner, accordingly, made an application under Section 129D (4) of the Act before the Tribunal. As the said application could not be made within the prescribed period and was delayed by 10 days, an application for condonation of delay was filed with a prayer for condonation. The Tribunal on 28.11.2005 [2006-TIOL-165-CESTAT-mum], however, rejected the application for condonation of delay and consequently dismissed the appeal by the following brief order:
“This appeal has been filed by the applicant commissioner in pursuance of the order of review passed by a committee of chief commissioners. In the application for condonation of delay filed by the applicant commissioner, a prayer has been made for condoning delay of 10 days. In the case of CCEx. Mumbai vs Azo Dye Chem 2000-(120) ELT 201 (Tri.-LB)= 2002-TIOL-448-CESTAT-DEL-LB , Larger Bench of the Tribunal has held that the Tribunal has no power to condone the delay caused in filing such appeals by the department beyond the prescribed period of 3 months. Even thought the said decision was in a Central Excise Case, the ratio of this decision is equally applicable to Customs case as the legal provisions under both the enactments are similar. Accordingly, we have no option but to reject the application for condonation of delay and the appeal stands dismissed.”
Consequently, the Revenue went to High Court and the High Court answered the question framed in affirmative that “Whether the CESTAT has discretionary power under section 129A (5) of the Customs Act, 1962 to condone the delay caused in filing the appeal under section 129D (3) [sec 129 D (4)] of the said Act, when there was sufficient cause available to the appellant for not filing it within the prescribed period before the Appellate Authority.
Thereafter, the said question lies before the Supreme Court that Whether it is competent for the Tribunal to invoke section 129A(5) of the Act where an application under 129D(4) has not been made by the commissioner within the prescribed time and condone the delay in making such application if it is satisfied that there was sufficient cause for not presenting it within that period.

APPELLANT’S CONTENION:The appellant submitted that Section 129D (4) of the Act was self contained and if the application contemplated therein was not made within the prescribed period, the Tribunal has no power or competence to condone the delay after expiry of the prescribed period. In support of his arguments he relied upon a larger Bench decision of the Customs, Excise and Gold (Control) Appellate Tribunal ('CEGAT') in Commissioner of Central Excise v. Azo Dye Chem ((2000) 12o ELT 201 (Tri-Delhi). He also placed heavy reliance upon a three-Judge Bench decision of this Court in Commissioner of Customs and Central Excise v. Hongo India Pvt. Ltd. and Another ((2009) 5 SCC 791) Learned counsel for the appellant also placed reliance upon decisions of this Court in Delhi Cloth and General Mills Co. Ltd. v. State of Rajasthan and Ors.[ (1996) 2 SCC 449 ], Fair growth Investments Ltd. v. Custodian [ (2004) 11 SCC 472 J and UCO Bank and Anr. v. Rajinder Lal Capoor.[ (2008) 5 SCC 257]

RESPONDENT’S CONTENTION:The respondent supported the view of the High Court in passing the impugned order. He submitted that the answer to the question under consideration was dependent on construction of Sections 129D and 129A of the Act.

REASONING OF JUDGEMENT:Sections 129 A and 129 D were thoroughly analysed by the Supreme Court. It was held that from the plain language of section 129D (4), it is clear that section 129A has been incorporated in section 129D. For the sake of brevity, instead of repeating what has been provided in section 129A as regards appeal to the Tribunal, it has been provided that the applications made by the Commissioner under section 129 D (4) shall be heard as if they were appeals made against the decision or order of the adjudicating authority and the provisions relating to the appeals to the Tribunal shall be applicable so far as may be applicable. Consequently section 129A (5) has become integral part of section 129D (4) of the Customs Act. In other words, if the Tribunal is satisfied that there was sufficient cause for not presenting the application under section 129D (4) within prescribed period, it may condone the delay in making such application and hear the same.
Parliament intended entire section 129A, as far as applicable, to be supplemental to section 129D (4) and that is why it provided that the provisions relating to the appeals to the Tribunal shall be applicable to the applications made under section 129D (4). The expression “including the provisions of sub-section (4) of section 129A” is by way of clarification and has been so said to expressly to remove any doubt about the applicability of the provision of cross objections to the applications made under section 129D (4) or else it may be said that provisions relating to appeal to Tribunal have been made applicable and not cross objections. The use of expression “so far as may be” is to make general provisions relating to appeal to the Tribunal into section 129D (4). Once, the provisions relating to appeal to the Tribunal have been made applicable, section 129A (5) stands incorporated in section 129D (4) by way of legal fiction and must be given effect to. Seen thus, it becomes clear that the Act has given express powers to the Tribunal to condone delay in making application under section 129D (4), if it is satisfied that there was sufficient cause for not presenting it within that period.
Further, the cases cited by the appellant were discussed in brief but none of the cases contained the question put in the present appeal and so the exercise of referring to the same was held to be useless.
In the present case, as noted above, the provisions relating to the appeals to the Tribunal have been made applicable to an application made under Section 129D(4) and it has been further provided that such application shall be heard as if it was an appeal made against the decision or order of the adjudicating authority. Any delay in presentation of appeal under Section 129A is condonable by the Tribunal by virtue of sub- section (5) thereof. The Tribunal has been invested with the same power for consideration of the applications under Section 129D(4) if it is satisfied that there was sufficient cause for not presenting such application within prescribed period as the provisions relating to the appeals to the Tribunal have been made applicable to such applications. The other case laws cited by the ld. Counsel for the appellant does not help the appellant at all. It is competent for the Tribunal to invoke Section 129A(5) where an application under Section 129D(4) has not been made within the prescribed time and condone the delay in making such application if it is satisfied that there was sufficient cause for not presenting it within that period. In view of the above, the appeal must fail and is dismissed with no order as to costs.

DECISION: The appeal is dismissed.

COMMENT:The analogy drawn from this case is that Tribunal has power to condone delay under section 129A (5) in filing of appeal by the applicant commissioner under section 129D of the Customs Act, 1962 even when the same is not specifically provided under section 129D due to usage of language “as if such application were an appeal made against the decision or order of the adjudicating authority”. Therefore, section 129A is incorporated in section 129D.

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PJ/Case Laws/2012-13/1330

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