2008 (7) TMI 424 - HC - Central Excise

Appeal dismissed for late filing under Central Excise Act. Upholding time limits for legal certainty.

The court held that the appeal filed beyond the prescribed period was not maintainable as the review order was passed after the limitation period ... Maintainability of appeal - Whether the Commissioner, Central Excise who reviewed the order of the adjudicating authority did not exercise his powers within a period of one year as provided in Section 35E(3) of the Act? Held that:- There is no manner of doubt that in the present case, the reviewing authority i.e. Commissioner (Appeals) passed the order on 7-4-1998 i.e. after the expiry of one year of the date of the order of the adjudicating authority as specified in Section 35E of the Act. Thus where a time is fixed for the purpose of exercising some power by the statute, such power must be exercised within the period so specified. Since power has not been exercised within the stipulated period, the direction to file an appeal was illegal. Therefore, the appeal filed by the department on the basis of such direction itself was not maintainable. Consequently, we uphold the order passed by the learned Tribunal. Issues:1. Review of order by Commissioner under Section 35E(2) of the Central Excise Act, 1944.2. Maintainability of appeal filed beyond the prescribed period.3. Legal question of appeal's maintainability.Analysis:1. The case involved a dispute where the respondent-assessee, a manufacturer of Optic Cable Fibre, deducted liquidated damages from the cost of the product based on contracts with government departments. The Assessing Authority initially accepted this deduction as permissible under Section 4 of the Central Excise Act, 1944.2. Subsequently, the Commissioner, Central Excise reviewed the order after the limitation period of one year specified in Section 35E(3) had expired. The Commissioner directed the filing of an appeal, which was allowed by the Commissioner (Appeals) but challenged by the assessee before the Tribunal on grounds of the review order being passed beyond the prescribed period.3. The Tribunal, citing relevant judgments, held that the appeal filed based on the review order passed after the limitation period was not maintainable. The parties presented arguments on whether the appeal's maintainability could be challenged at any stage, with the court emphasizing that the legal question of maintainability could be raised irrespective of when the appeal was argued.4. The court highlighted that the power under Section 35E is for superintendence to ensure correct exercise of powers, and when a time limit is specified in the statute, such power must be exercised within that period. Citing a specific case, the court concluded that as the power was not exercised within the stipulated period, the direction to file the appeal was illegal, rendering the appeal itself not maintainable.5. Ultimately, the court upheld the Tribunal's decision, emphasizing that the appeal filed beyond the specified period was not maintainable. The judgment clarified the importance of adhering to statutory time limits for exercising powers under the Central Excise Act, ensuring administrative efficiency and legal certainty in such matters.6. In conclusion, the court answered the reference in favor of upholding the Tribunal's decision, emphasizing the necessity of complying with statutory timelines for exercising powers under the Central Excise Act.