2023 (6) TMI 56 - HC - VAT and Sales Tax

Validity of appeal service upheld despite address change claim; dismissal due to COVID-19 delay affirmed

The court upheld the validity of service of appeal orders at the petitioner's old address, rejecting claims of address change. The dismissal of appeals by ... Condonation of delay in filing of appeal - Service of order - order was sent to old address - Revenue’s main contention is that the orders were served at the address given by assessee and it is assessee’s duty to intimate the change in the address if any - HELD THAT:- It is relevant to note that the assessee’s address mentioned in the memorandum of petition, the application for condonation of delay and written submissions filed before the KAT are the same as mentioned in the postal acknowledgement receipt. This clearly shows that assessee’s main contention that he had changed his address is factually incorrect. Therefore, the contention urged by assessee that the orders were sent to his old address is untenable. The learned KAT has analyzed the facts in extenso and rightly recorded a finding that there was no proper explanation for the delay. Assessee has reiterated the same grounds seeking condonation of delay. There are no merit in this revision petition and impugned order passed by the KAT does not call for any interference - Revision Petition is dismissed. 1. ISSUES PRESENTED AND CONSIDERED 1. Whether service of appellate orders dated 26.04.2019 and 06.06.2019 upon the assessee at the address reflected in the postal acknowledgment constitutes valid service under Rule 176 of the Karnataka Value Added Tax Rules (KVAT Rules). 2. Whether, having regard to the asserted late knowledge of the appellate orders, the dates on the postal acknowledgment may be excluded for computing limitation for filing appeals under the Tribunal's jurisdiction. 3. Whether the Tribunal rightly dismissed the appeals for delay despite the contention about COVID-19 period affecting limitation. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Validity of Service under Rule 176 of KVAT Rules Legal framework: Rule 176 prescribes mode and persons for service of appeal orders, requiring service on the assessee or his manager or agent and proper addressing for effective service. Precedent Treatment: The Court noted reliance placed by the assessee on authorities concerning service and effect of postal acknowledgments, but the Tribunal's approach was based on factual determination; no precedent was overruled or distinguished in the judgment. Interpretation and reasoning: The Court examined the postal acknowledgment which bore the same address as used by the assessee in his memo of revision, condonation application and written submissions. The assessee asserted a change of address, but documentary record showed consistency with the acknowledged address. Therefore, service at that address matched the addressee details maintained by the assessee in official filings. The Court held that where the postal acknowledgment reflects the address supplied by the recipient in official records, service under Rule 176 is effectual and cannot be impeached by a later unilateral claim of change of address unsupported by contemporaneous notification to the department. Ratio vs. Obiter: Ratio - A postal acknowledgment at an address which the assessee continued to use in official pleadings constitutes valid service under Rule 176; unilateral, unnotified change of address by the assessee is insufficient to vitiate service. Observational remarks about the requirement to intimate change of address and the role of departmental records are incidental but supportive. Conclusion: Service of the appellate orders at the address reflected in the postal acknowledgment was effective under Rule 176; the assessee's contention of service at an old address was factually untenable. Issue 2 - Effect of Date of Acknowledgment on Computation of Limitation Legal framework: Limitation for filing appeals runs from date of service; correctness of the service date depends on effective service as per statutory rules (Rule 176). If service is valid, the postal acknowledgment date governs the commencement of limitation. Precedent Treatment: The Court considered the Tribunal's factual finding regarding delay and did not depart from established principles that limitation begins on valid service; no precedent was overruled. Interpretation and reasoning: Given the finding that service at the acknowledged address was proper, the dates on the acknowledgment (19.05.2019 and 13.06.2019) are operative for computing limitation. The assessee's later dates of learning about the orders could not displace the constructive service evidenced by the acknowledgment because the assessee had not given notice of a change of address and continued to use the same address in official documents. Ratio vs. Obiter: Ratio - Where service is shown by postal acknowledgment at the address which the assessee continued to use in official communications, the acknowledgment date is the effective date for limitation purposes. Observations on the interplay of constructive service and actual notice are explanatory. Conclusion: The acknowledgment dates are the proper dates for computing limitation; the assessee's later awareness does not render the acknowledgment ineffective. Issue 3 - Condonation of Delay in Filing Appeals and Effect of COVID-19 Legal framework: Condonation of delay requires demonstration of sufficient cause for the delay; judicial consideration of COVID-19 period follows directions from higher authorities but remains subject to proof of incapacity to institute appeals within extended or applicable periods. Precedent Treatment: The assessee relied on general authorities addressing delay and service; the Court did not adopt any wholesale extension but applied the sufficiency-of-cause standard to the facts. Prior higher court guidance on limitation during COVID-19 was noted but the Tribunal's factual conclusion on lack of sufficient explanation was upheld. Interpretation and reasoning: The Tribunal analyzed the grounds for delay in detail and found no adequate explanation; the assessee repeatedly relied on the same grounds before the Tribunal without producing evidence of being prevented from filing appeals in time. Although reference was made to a higher court order regarding limitation during the COVID-19 period, the Court treated such relief as inapplicable in the absence of a satisfactory factual foundation showing that the pandemic prevented filing within any applicable extended period. Moreover, because service dates were earlier (2019), the period of delay was measured from those operative dates and predated the pandemic-related limitation adjustments relied upon. Ratio vs. Obiter: Ratio - Where the service date is established and the assessee fails to provide sufficient cause for delay, appeals may be dismissed notwithstanding generalized assertions about pandemic-related hindrances. Observations about the duty to intimate change of address and administrative expectations during pandemic periods are ancillary. Conclusion: The Tribunal correctly dismissed the appeals for delay; the petitioner's generalized claim about COVID-19 did not furnish sufficient cause for condonation given the operative service dates and absence of supporting evidence. Cross-reference The conclusions on Issues 1 and 2 are interdependent: valid service at the address used by the assessee establishes the operative dates for limitation, which in turn defeats the sufficiency of cause for delay considered under Issue 3. Final Disposition The Court confirmed the Tribunal's factual findings and legal conclusions: service was effective under Rule 176, the acknowledgment dates govern limitation, and there was no sufficient cause to condone the delay; the appeals' dismissal for delay was upheld. No order as to costs.