Baba Container Mfrs. vs Additional Collector of Customs and Central Excise, Hyderabad

Syed Shah Mohammed Quadri, J.—The Petitioner challenges the validity of the order passed by the Customs, Excise & Cold (Control) Appellate Tribunal, the 2nd respondent herein, in Order No. 1173, dated 23-5-1996 as also the Order No. 173/1991, dated 25-11-1991 of the 1st Respondent as being illegal and arbitrary.

To appreciate the contentions urged before us, it would be necessary to note the relevant facts giving rise to filing of this writ petition. The petitioner is a partnership firm dealing in manufacture of Metal Containers. It has a factory situated at Self-employment Industrial Estate, Kattedan, Hyderabad. The petitioner has been availing the facility of MODVAT credit under Rule 57A of the Central Excise Rules, 1944 (for short ''the Rules''). The Additional Collector of Customs & Central Excise, the 1st Respondent herein, having noticed that the petitioner has taken credit under Rule 57A of the Rules, without showing the evidence of payment of duty on inputs, issued a show cause notice calling upon the petitioner as to why the duty of Rs. 2,91,599.12 Ps should not be collected. The petitioner filed the explanation on 9-2-1988. The 1st Respondent was however, satisfied with the explanation only with regard to an amount of Rs. 18,484.90 Ps by order dated 31-8-1990. The Petitioner challenged the validity of the order of the 1st Respondent before the 2nd Respondent. On 13-2-1991, the second Respondent remanded the matter to the 1st Respondent for fresh disposal in accordance with law. After remand, the hearing of the case was fixed by the 1st Respondent on 1-11-1991. But, on 31-10-1991, the petitioner filed an application for adjournment. However, on 25-11-1991, the 1st Respondent disallowed the credit in respect of 66 cases claimed by the petitioner in the reply to the show cause notice and demanded duty amounting to Rs. 2,73,105.22 Ps. Then the petitioner carried the matter in appeal before the 2nd Respondent by presenting a memorandum of appeal on 27-1-1992. It appears that the memorandum of appeal was not in conformity with the Rules as the same was not verified by the petitioner. On 25-8-1995, the 2nd Respondent dismissed the appeal but gave liberty to represent the same. The Petitioner represented the appeal on 6-5-1996 with an application to condone the delay in representation. The Tribunal found that there was no valid reason for the delay and dismissed the appeal on 23-5-1996. It is the correctness of that order of the 2nd Respondent and the order of the 1st Respondent, dated 25-11-1991 referred to above, that is ......... to this writ petition.

Mr. S. Ravindranath, the learned Counsel for the petitioner, contends that under the Rules, no time limit is fixed for representation of the appeal, therefore, it cannot be said that there was delay in representation and therefore, in this context, the Tribunal ought not to have dismissed the appeal by the impugned order.

Heard the learned Senior Central Government Standing Counsel.

We are afraid, we cannot accede to the, contention of the learned Counsel. It is true that there is no time fixed for representation. But, the representation of the appeal must be within a reasonable time. Having regard to the order of dismissal of the appeal, dated 25-8-1995 giving liberty to represent the appeal, the appeal should have been represented within a reasonable time from that date. In this case, under proviso to Section 35 of the Central Excises and Salt Act, 1944, the time allowed for filing the appeal is only 90 days. What would be the reasonable time for representation, in the absence of any statutory period fixed for that purpose, would be a question of fact which has to be decided on the facts and in the circumstances of the case, inter alia, having regard to the nature of the defects to be rectified, the difficulty faced by the petitioner in rectifying the defects. In the instant case, the defect to be rectified was only verification by the petitioner. That would hardly take any time to comply with the defect in the memorandum of ground. Further, we are also of the view that in considering the reasonable period for representation, the time allowed for filing the appeal would also be a relevant factor.

Having regard to these facts and circumstances, the period of nine months for representation cannot be said to be a reasonable time. We cannot also overlook the fact that the petitioner himself made an application to the 2nd respondent to condone the delay in representation. Now, he cannot turn round and say that there has been no delay in representation as no time was fixed. The Tribunal considered the application of the petitioner on the grounds mentioned in the application that the consultant of the petitioner was not well and therefore, the appeal could not be represented. It appears that the appeal has eventually been represented by the petitioner himself. Nothing was brought on record to show that the Consultant was so unwell as to make the appeal papers available to the petitioner. No medical certificate or other documents were produced before the Tribunal. Having regard to these circumstances, in our view, the Tribunal was right in declining to condone the delay. We, therefore, find no error of law much less an error of law apparent on record to justify interference of this Court in the impugned orders.

The Writ Petition is, therefore, dismissed at the state of admission.