Shahul Textiles Mills (P) Ltd. vs CESTAT, Chennai

F.M. Ibrahim Kalifulla, J.—The assessee has come forward with this appeal challenging the order of the Customs, Excise and Service Tax Appellate Tribunal, Chennai, dated 7-1-2010 in E/COD/13/2009 & E/PD/15/and E 28/2009.

By the order impugned the Tribunal rejected the appellant''s application for condonation of delay along with the stay petition and the main application. The short facts are that the appellant was engaged in the manufacture of cotton yarn, that according to the respondent the appellant clandestinely removed the manufactured cotton yarn without payment of duty by wrongly availing the exemption under Notification No. 1/93 as amended. With the further allegation that the appellant was using bogus invoice for clearing the goods without payment of duty. It was also alleged that the appellant cleared the cotton yarn over and above the exempted limit of Rs. 30,00,000/-. On the above said basis, the duty payable by the appellant was determined in a sum of Rs. 69,370/-. An equal amount by way of penalty plus Rs. 5,000/- was imposed under Rules 9(2), 52A and 173-Q of the Central Excise Rules, 1944 and Section 11AC of the Central Excise Act, 1944.

The appellant preferred an appeal before the Commissioner of Appeals in Appeal No. 477 of 2003. The said appeal came to be dismissed on 6-1-2004. According to the appellant, since its unit was closed, the appellant did not have the opportunity before the Commissioner of Appeals and no notice was also served on the appellant. It is also the case of the appellant that even the order copy dated 6-1-2004, passed in Appeal No. 477 of 2003 was received by the appellant only on 27-9-2008. The appellant preferred further appeal before the Tribunal on 6-1-2009. Since the appellant had 90 days time to file the appeal and the appeal was filed only on 6-1-2009. There was a delay of 10 days in filing the appeal. The Tribunal while dealing with the said application for condonation of delay, passed the impugned order stating that there was inordinate delay in pursuing the appeal. At the time when this appeal came up for admission, we directed Mr. Virkram Ramakrishnan, learned Standing Counsel for respondents 2 and 3, to get instructions as to the date of service of the order of the Commissioner of Appeals dated 6-1-2004, on the appellant in order to find out whether there was an inordinate delay. Learned Standing Counsel for the respondents 2 and 3 after getting instructions, stated that there were no other records in the office of the respondents to show that the order of the Commissioner of Appeals, dated 6-1-2004, was served on the appellant on any data prior to 27-9-2008. In the said circumstances, if the order dated 6-1-2004 was served on the appellant only on 27-9-2008, it cannot be held that there was any delay beyond 10 days as has bean stated in the order passed in the application for condonation of delay. The reason adduced by the appellant was due to the closure of the Mills, it took some time for gathering materials for filing the appeal, which cannot be held to be not a justifiable reason. Certainly, it cannot be held that there was inordinate delay in filing the appeal. Inasmuch as going by the date of receipt of the order and the time allowed for filing the appeal, the delay was only 10 days in filing the appeal before the Tribunal, we do not find any justification in the order passed by the Tribunal in having rejected the appellant''s appeal on the ground of inordinate delay. The impugned order is therefore, set aside. The Tribunal is directed to take the appellant''s appeal on file if otherwise in order, as well as the stay petition and dispose of the same in accordance with law. The appeal stands allowed. No costs