2007 (10) TMI 239 - HC - Central Excise

High Court overturns time-barred dismissal, orders reexamination, citing Limitation Act, emphasizes fairness in excise appeals.

INDIAN SULPHACID INDUSTRIES LTD. Versus UNION OF INDIA

The High Court set aside the Commissioner Central Excise's order dismissing an appeal as time-barred, directing a reexamination of the case. The Court ... Appeal filed by the petitioner dismissed by commissioner (A) by opining that it was barred by time - provisions of Section 5 of Limitation Act, 1963 Act would apply to Section 35 of Central Excise Act by virtue of judgments of Supreme Court in several cases - Commissioner (Appeals) is directed to consider the case of the petitioners by taking into account the fact as to whether the petitioners were prevented by sufficient cause from filing the appeal Issues:1. Quashing of order dated 2.9.2003 passed by the Commissioner Central Excise.2. Consideration of appeal on merits after condoning the delay in filing.3. Application of Section 5 of the Limitation Act, 1963 to Section 35 of the Central Excise Act.4. Setting aside the impugned order and directing the Commissioner to reconsider the case.Analysis:1. The petitioner sought to quash the order dated 2.9.2003 passed by the Commissioner Central Excise, which dismissed the appeal as time-barred. The petitioner was served with a show cause notice for alleged suppression of production of Sulphuric Acid and Alum Ferric. The Adjudicating Authority confirmed the demand of central excise duty and imposed penalties. The appeal was dismissed by the Commissioner on the grounds of being time-barred, exceeding the 90-day limit for filing appeals under Section 35 of the Central Excise Act.2. The matter was brought before the High Court, where it was initially dismissed due to a statement made by the petitioner's counsel regarding the inability to condone the delay beyond 90 days under Section 35 of the Act. However, upon filing a Review Application, the High Court reconsidered the application of Section 5 of the Limitation Act, 1963 to Section 35 of the Central Excise Act. Citing relevant judgments, the High Court held that Section 5 of the Limitation Act would apply, allowing for the condonation of delay if sufficient cause is shown.3. Consequently, the High Court set aside the impugned order dated 2.9.2003 and directed the Commissioner to reexamine the case, considering whether the petitioners were prevented by sufficient cause from filing the appeal. If sufficient cause for the delay is found under Section 5 of the Limitation Act, the Commissioner is instructed to proceed with deciding the appeal on its merits. The petitioners were granted the liberty to file an application explaining the delay, and both parties were directed to appear before the Commissioner on a specified date for further proceedings.Conclusion:The High Court's judgment focused on the application of Section 5 of the Limitation Act to condone the delay in filing the appeal under the Central Excise Act. By setting aside the order and directing a reevaluation of the case, the Court ensured that the petitioners have the opportunity to present sufficient cause for the delay, emphasizing the importance of procedural fairness and legal principles in the adjudication of appeals in excise matters.