The Madhya Pradesh High Court on 28 October held that when the last day of the condonable period for filing an appeal falls on a Sunday, an appeal filed on the next working day cannot be rejected as time-barred.
A Bench comprising Chief Justice Alpesh Y. Kogje and Justice Vivek Jain allowed the appeal and set aside the orders of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) and the Commissioner (Appeals), which had rejected the appellant's service tax appeal as time-barred. The judges observed:
“the condonable period of 30 days would commence on 23.11.2018 to 23.12.2018, which again was a Sunday and therefore when the appeal came to be filed on 24.12.2018, it was still within the condonable period.”
The case arose from a service tax demand of approximately Rs. 70 lakh against the appellant, who was engaged in construction services. The Commissioner (Appeals) rejected his appeal against the demand as time-barred, and the CESTAT subsequently upheld the rejection.
Before the High Court, the appellant argued that the authorities had incorrectly calculated the limitation period and dismissed the appeal without giving him an opportunity to explain the delay.
The Court found that the 30-day condonable period ended on Sunday, 23 December 2018, and the appellant filed the appeal on the next working day, 24 December 2018. The appeal was therefore filed within the condonable period.
It held that the Commissioner (Appeals) had misinterpreted Section 85(3A) of the Finance Act, 1994, which permits the authority to condone a delay of up to 30 days beyond the prescribed limitation period if sufficient cause is shown.
Further, the Bench found that the authorities had violated the principles of natural justice by dismissing the appeal without giving the appellant an opportunity to explain the delay.
Accordingly, the High Court set aside the orders of the CESTAT and the Commissioner (Appeals) and directed the Department to reconsider the appeal after giving the appellant an opportunity to explain the delay.
For the Appellant: Advocate Sapan Usrethe
For the Respondent: Advocate Abhijeet Shrivastava