Customs limitation rules on pending notices and Section 14 exclusion still require appeals to meet the statutory outer limit.

A customs limitation note on pending show cause notices and delayed appeals under the Customs Act. A notice kept in abeyance could still be adjudicated within time when the six-month period under section 28(9), read with section 28(9A), was computed from the date the abeyance reason ceased, and COVID-related limitation orders plus the Chief Commissioner's extension preserved timeliness. The note also states that section 14 of the Limitation Act can apply to appeals under section 128 where a party bona fide pursued an abortive remedy, but exclusion of time cannot extend filing beyond the statute's maximum permissible period; on those facts, the appeals remained time-barred.

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Issues: (i) Whether the show cause notices under section 28 of the Customs Act, 1962 were adjudicated within the time permitted by section 28(9), read with section 28(9A), of the Customs Act, 1962 and the limitation-relaxation measures during the COVID-19 period; (ii) Whether the appellant was entitled to exclusion of time under section 14 of the Limitation Act, 1963 so as to treat the appeals under section 128 of the Customs Act, 1962 as within limitation.

Issue (i): Whether the show cause notices under section 28 of the Customs Act, 1962 were adjudicated within the time permitted by section 28(9), read with section 28(9A), of the Customs Act, 1962 and the limitation-relaxation measures during the COVID-19 period.

Analysis: The notices were issued while the recovery proceedings remained pending because the refund issue was sub judice before the Supreme Court. Once the reason for keeping the notices in abeyance ceased on 18.09.2019, the six-month period under section 28(9) was computed from that date. The Court held that the relaxation under section 6 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 did not assist because the relevant period had expired before 20.03.2020, but the later Supreme Court orders on COVID-related limitation, together with the extension granted by the Chief Commissioner, covered the period in question and kept the adjudication within time. The objection that the recovery was barred by limitation was therefore rejected.

Conclusion: The adjudication was held to be within time and the challenge on limitation failed, in favour of the Revenue.

Issue (ii): Whether the appellant was entitled to exclusion of time under section 14 of the Limitation Act, 1963 so as to treat the appeals under section 128 of the Customs Act, 1962 as within limitation.

Analysis: The Court accepted that section 14 and its underlying principles can apply to appeals under section 128 of the Customs Act, 1962 where a party has bona fide and diligently pursued an abortive remedy. The refund proceedings and the later reassessment appeals were treated as relating to the same basic controversy, namely entitlement to refund of excess additional duty. However, even after excluding the period spent in pursuing the refund remedy up to 18.09.2019, the further period between the Supreme Court's decision in ITC and the filing of the appeals on 17.12.2019 still took the matters beyond the maximum period permissible under section 128.

Conclusion: The benefit of section 14 did not make the appeals timely, and the dismissal of the appeals as time-barred was upheld, against the appellant.

Final Conclusion: The recovery orders and the dismissal of the reassessment appeals were sustained, and the entire batch of appeals failed on limitation.

Ratio Decidendi: Where a statute fixes a strict outer limit for appeal, the period may be excluded only to the extent the facts fit the equitable principle of Section 14, but the appeal must still be filed within the statutory maximum period after such exclusion; similarly, a show cause notice kept pending under section 28(9A) can be adjudicated within the time as extended by the governing limitation-relaxation orders.

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