M/S Swapnil Builders And Developers vs. The Commissioner ( Appeals)

Facts

The petitioner, M/s Swapnil Builders and Developers, filed a writ petition challenging an order dated September 29, 2023, by the Commissioner (Appeals), Central GST and Central Excise. This order dismissed the petitioner's appeal against an order dated March 29, 2022, passed by the Additional Commissioner (Adjudication), on the grounds of limitation. The original show-cause notice dated January 18, 2017, issued by the Additional Commissioner, sought recovery of service tax amounting to Rs. 84,83,833/- plus cess and Rs. 4,93,494/- under Reverse Charge Mechanism. An ex-parte order was passed on February 28, 2018, which was later set aside and remanded by the appellate authority. The adjudicating authority, on remand, passed an order on March 29, 2022, confirming a demand of Rs. 44,70,773/- for service tax, along with interest and penalties. The petitioner received this order on September 21, 2022, deposited Rs. 3,53,310/- as pre-deposit, and filed an appeal on December 21, 2022.

Held

The Court held that the appeal was filed within the extendable period of limitation. The Court reasoned that the limitation period for filing an appeal under Section 85(3-A) of the Finance Act, 1994, commences from the day following the receipt of the order. Therefore, with the order received on September 21, 2022, the two-month period for filing the appeal would expire on November 21, 2022. The proviso to Section 85(3-A) allows for an extension of one month if sufficient cause is shown. Calculating this further period from November 22, 2022, the appeal filed on December 21, 2022, falls within this extended period. The Court found that the appellate authority failed to consider the starting point of limitation in light of Section 12(1) of the Limitation Act, 1963, Section 9 of the General Clauses Act, 1897, and relevant Supreme Court judgments. The impugned order was deemed unsustainable. The Court directed that the matter be remitted back to the appellate authority to consider the application for condonation of delay, if filed by the appellant, and decide the appeal on its merits after providing an opportunity of hearing.

Key Issues

1. Whether the appeal filed by the petitioner before the Commissioner (Appeals) on December 21, 2022, was within the prescribed limitation period under Section 85(3-A) of the Finance Act, 1994, considering the receipt of the order on September 21, 2022? Petitioner's arguments: The petitioner contended that the limitation period of two months for filing the appeal should be calculated from September 22, 2022 (excluding the date of receipt). Two months from this date would expire on November 21, 2022. The further extendable period of one month would expire on December 21, 2022. Therefore, the appeal filed on December 21, 2022, was within the extendable period. They cited Section 12(1) of the Limitation Act, 1963, Section 9 of the General Clauses Act, 1897, and the definition of 'month' as a calendar month. They also argued that a technical glitch on the Service Tax portal caused a delay and that the appellate authority should have allowed an application for condonation of delay. Respondent's arguments: The respondents argued that the petitioner was aware of the limitation period but intentionally did not file an application for condonation of delay. They asserted that the appellate authority rightly dismissed the appeal as barred by limitation.