Hansaflon Plasto Chem. Ltd. vs State of Haryana and others

Ajay Kumar Mittal, J.—This appeal has been filed by the dealer u/s 36 of the Haryana Value Added Tax Act, 2003 (in short, "the Act") against the order dated November 28, 2011 (annexure A9) passed by the Haryana Tax Tribunal (hereinafter referred to as "the Tribunal") claiming the following substantial questions of law : (i) Whether, on the facts and in the circumstances of the case, the honourable Tribunal was justified in dismissing the application for restoration of appeal ?

(ii) Whether, on the facts and in the circumstances of the case, the honourable Tribunal was justified in not condoning the delay caused by mistake of the counsel for the appellant ?

Briefly stated, the facts for adjudication of the present appeal are that the appellant is a registered dealer and engaged in the business of manufacturing non-stick plastic coating and magnesium oxide and magnesium carbonated and allied products. It had applied for exemption from paying sales tax which was taken by the Higher Level Screening Committee in its meetings held on June 29, 2004 and June 30, 2004. The claim for exemption of the dealer was rejected vide letter dated November 3, 2004 (annexure A1) against which an appeal was filed before the Commissioner and Secretary to State of Haryana under the unamended rule. On July 4, 2005, the dealer received a letter dated June 23, 2005 (annexure A2) from the Commissioner and Secretary to the State of Haryana stating therein that the appeal against the order of the Higher Level Screening Committee shall lie before the Tribunal. Accordingly, an appeal was filed before the Tribunal on July 13, 2005, along with an application for condonation of delay. The Tribunal vide order dated August 1, 2008 (annexure A5) dismissed the appeal on the ground of limitation after noticing that fourteen opportunities had been provided to the appellant and the appeal was never pursued seriously. Thereafter, on March 5, 2010, the dealer received summon for the recovery of sales tax arrears and approached the counsel as according to it, the case was still pending before the Tribunal. On enquiries, it was found that the counsel for the dealer had received a letter on September 10, 2008, from the Tribunal who misplaced the same. It was only after the appellant received summons and approached its counsel, it came to know about the order of the Tribunal on March 5, 2010. An application for restoration of the appeal (annexure A6) was filed before the Tribunal on April 7, 2010 accompanied by an application for condonation of delay of 549 days. The Tribunal vide order dated November 28, 2011 (annexing A9) dismissed the application for restoration of appeal. Hence, the present appeal.

The learned counsel for the appellant submitted that the application for condonation of delay of 549 days for restoration of the appeal was decided against the appellant by the Tribunal. He has placed reliance upon the judgments in Rafiq and Another Vs. Munshilal and Another, Collector, Land Acquisition, Anantnag and Another Vs. Mst. Katiji and Others, , N. Balakrishnan Vs. M. Krishnamurthy, , Ram Nath Sao alias Ram Nath Sahu v. Gobardhan Sao [2002] 3 SCC 195, Mahaveerprasad Jain Vs. Commissioner of Income Tax, and Concord of India Insurance Co. Ltd. Vs. Smt. Nirmala Devi and Others, to contend that the appellant should not suffer for the lapses of its counsel. It was further submitted that for condoning the delay in filing the application for restoration of appeal, no prejudice was caused to the respondent. Moreover, the appellant did not derive any benefit by delaying the proceedings. It was a]so submitted that there was sufficient cause for condonation of delay as there was no intimation from the counsel and, therefore, the appellant could not file the application earlier.

Examining the legal position relating to condonation of delay u/s 5 of the Limitation Act, 1963 (in short, "the 1963 Act"), it may be observed that the honourable Supreme Court in Oriental Aroma Chemical Industries Ltd. Vs. Gujarat Industrial Development Corporation and Another, laying down the broad principles for adjudicating the issue of condonation of delay, in paras 14 and 15 observed as under :

We have considered the respective submissions. The law of limitation is founded on public policy. The Legislature does not prescribe limitation with the object of destroying the rights of the parties but to ensure that they do not resort to dilatory tactics and seek remedy without delay. The idea is that every legal remedy must be kept alive for a period fixed by the Legislature. To put it differently, the law of limitation prescribes a period within which legal remedy can be availed of for redress of the legal injury. At the same time, the courts are bestowed with the power to condone the delay, if sufficient cause is shown for not availing of the remedy within the stipulated time.

The expression ''sufficient cause'' employed in section 5 of the Indian Limitation Act, 1963 and similar other statutes is elastic enough to enable the courts to apply the law in a meaningful manner which subserves the ends of justice. Although, no hard and fast rule can be laid down in dealing with the applications for condonation of delay, this court has justifiably advocated adoption of a liberal approach in condoning the delay of short duration and a stricter approach where the delay is inordinate- Collector, Land Acquisition, Anantnag and Another Vs. Mst. Katiji and Others, , N. Balakrishnan Vs. M. Krishnamurthy, and Vedabai @ Vaijayanatabai Baburao Pateil Vs. Shantaram Baburao Patil and Others,

It was further noticed by the honourable apex court in R. B. Ramlingam v. R. B. Bhuvaneshwari [2009] 1 RCR (Civil) 892, as under :

... It is not necessary at this stage to discuss each and every judgment cited before us for the simple reason that section 5 of the Limitation Act, 1963, does not lay down any standard or objective test. The test of ''sufficient cause'' is purely an individualistic test. It is not an objective test. Therefore, no two cases can be treated alike. The statute of limitation has left the concept of ''sufficient cause'' delightfully undefined, thereby leaving to the court a well-intentioned discretion to decide the individual cases whether circumstances exist establishing sufficient cause. There are no categories of sufficient cause. The categories of sufficient cause are never exhausted. Each case spells out a unique experience to be dealt with by the court as such.

It was also recorded that:

For the aforestated reasons, we hold that in each and every case the court has to examine whether delay in filing the SLP stands properly explained. This is the basic test which needs to be applied. The true guide is whether the petitioner has acted with reasonable diligence in the prosecution of his appeal/petition. . .

From the above, it emerges that the law of limitation has been enacted which is based on public policy so as to prescribe time-limit for availing of legal remedy for redressal of the injury caused. The purpose behind enacting law of limitation is not to destroy the rights of the parties but to see that the uncertainty should not prevail for unlimited period. u/s 5 of the 1963 Act, the courts are empowered to condone the delay where a party approaching the court belatedly shows sufficient cause for not availing of the remedy within the prescribed period. The meaning to be assigned to the expression "sufficient cause" occurring in section 5 of the 1963 Act should be such so as to do substantial justice between the parties. The existence of sufficient cause depends upon facts of each case and no hard and fast rule can be applied in deciding such cases.

The honourable apex court in Oriental Aroma Chemical Industries Ltd. Vs. Gujarat Industrial Development Corporation and Another, and R. B. Ramlingam''s case [2009] 1 RCR (Civil) 892 noticed that the courts should adopt liberal approach where delay is of short period whereas the proof required should be strict where the delay is inordinate. Further, it was also observed that judgments dealing with the condonation of delay may not lay down any standard or objective test but is purely an individualistic test. The court is required to examine while adjudicating the matter relating to condonation of delay on exercising judicial discretion on individual facts involved therein. There does not exist any exhaustive list constituting sufficient cause. The applicant/petitioner is required to establish that inspite of acting with due care and caution, the delay had occurred due to circumstances beyond his control and was inevitable.

Adverting to the factual matrix in this case, we do not find any merit in the appeal. The question regarding whether there is sufficient cause or not depends upon each case and primarily is a question of fact to be considered taking into totality of events which had taken place in a particular case. In the present case after appreciating the matter it cannot be said that there was sufficient cause for condonation of delay. The Tribunal had decided the matter on August 1, 2008, and a communication was sent to the counsel on September 10, 2008. The Tribunal has noticed that order dated August 1, 2008 was passed after affording fourteen opportunities to the appellant who was avoiding proceedings on one pretext or the other. The plea of the appellant is that his counsel had misplaced the copy of the order dated August 1, 2008 by putting it in another brief and it came to their notice only on March 5, 2010. Such plea does not inspire confidence in the facts and circumstances of the present case. The counsel had not appeared on August 1, 2008, before the Tribunal. It has been wrongly mentioned in the affidavit of the advocate appended as annexure A7 with the present appeal that the case was heard and the judgment was reserved on August 1, 2008 whereas the case was decided on August 1, 2008 itself. Thus, the case was not being pursued diligently. There has been an inordinate delay of 549 days in filing the appeal. The learned counsel for the appellant was unable to demonstrate any steps taken against the counsel for his negligence. Such a plea without there being any material to substantiate cannot be accepted as such pleas invariably can be taken in all cases as a general defence. To put it differently, it does not mean that just by pleading a mistake of the counsel, the condonation of delay is to be granted. Adverting to the case law relied upon by the learned counsel for the appellant, suffice it to notice that the same being based on individual fact-situation involved therein does not come to the rescue of the appellant. In view of the above, no question of law much less a substantial question of law arises in this appeal. Accordingly, there is no merit in this appeal and the same is hereby dismissed.