2025(05)LCX0581

Malhotra Agro Industries

Versus

Deputy Commissioner

D.B. Civil Writ Petition No. 17270/2024 decided on 30-05-2025

HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR

D.B. Civil Writ Petition No. 17270/2024

Malhotra Agro Industries, Having Office At F-79, Phase I, Ind Area Bhiwadi, Alwar, Rajasthan- 301019. Through Its Proprietor, Shri Kirti Malhotra S/o Late Shri Chandar Mohan Malhotra, Aged About 49 Years, R/o House No. 8, Sector-17A, Lane No. 15, Defence Colony, Near Bata Corporate Office, Gurgaon - 122001.

----Petitioner

Versus

1. Deputy Commissioner, State Goods And Service Tax Department Circle-A, Bhiwadi, Alwar, Rajasthan.

2. Additional Commissioner (Appeals), State Goods And Service Tax Department, Alwar, A-9, H.k.m. Nagar, Kar Bhawan, Alwar-301001.

3. The Union Of India, Ministry Of Finance, Department Of Revenue, Room No. 46, North Block, New Delhi-110001, Through Its Secretary.

4. State Of Rajasthan, Through The Joint Secretary (Tax), Finance Department, Ist Floor, Main Building, Government Secretariat, Jaipur-302005, Rajasthan.

----Respondents

For Petitioner(s) : Mr. Prateek Kedawat through VC

For Respondent(s) : Mr. Jay Upadhyay
                               Mr. Kartikeya Sharma for
                               Mr. Sandeep Taneja,AAG

HON'BLE MR. JUSTICE AVNEESH JHINGAN 

HON'BLE MR. JUSTICE ANAND SHARMA

Order

30/05/2025

1. This petition is filed aggrieved of order dated 29.08.2024 passed by the first appellate authority dismissing the appeal having been filed three years and twenty days beyond limitation.

2. Section 107(4) of the Central Goods and Services Tax Act, 2017 is reproduced hereunder:-

“(4) The Appellate Authority may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of three months or six months, as the case may be, allow it to be presented within a further period of one month.”

2.1 The language of the provision is unambiguous that applicability of section 5 of the Limitation Act is ousted and the power to condone delay by the appellate authority is only upto thirty days.

3. It is not disputed in the present case that delay is of three years and twenty days. The issue is no longer res-integra. The Supreme Court in Union of India (UOI) Vs. Popular Construction Co. reported in [(2001)8 SCC 470] while adjudicating the issue regarding applicability of Section 5 of 1963 Act for condonation of delay in filing an application under Section 34(3) of the Arbitration and Conciliation Act, 1996, considering its earlier decision in Vidyacharan Shukla Vs. Khubchand Baghel reported in [AIR 1964 SC 1099], Hukumdev Narain Yadav Vs. Lalit Narain Mishra reported in [(1974)2 SCC 133] held:-

“12. As far as the language of Section 34 of the 1996 Act is concerned, the crucial words are 'but not thereafter' used in the proviso to sub-section (3). In our opinion, this phrase would amount to an express exclusion within the meaning of Section 29(2) of the Limitation Act, and would therefore bar the application of section 5 of that Act. Parliament did not need to go further. To hold that the Court could entertain an application to set aside the award beyond the extended period under the proviso, would render the phrase 'but not thereafter' wholly otiose. No principle of interpretation would justify such a result.

16. Furthermore, section 34(1) itself provides that recourse to a court against an arbitral award may be made only by an application for setting aside such award "in accordance with" sub Section 2 and sub Section 3. Sub Section 2 relates to grounds for setting aside an award and is not relevant for our purposes. But an application filed beyond the period mentioned in Section 34, sub-section (3) would not be an application "in accordance with" that sub section. Consequently by virtue of Section 34(1), recourse to the court against an arbitral award cannot be made beyond the period prescribed. The importance of the period fixed under Section 34 is emphasised by the provisions of Section 36 which provide that

"where the time for making an application to set aside the arbitral award under Section 34 has expired...the award shall be enforced and the Code of Civil Procedure 1908 in the same manner as if it were a decree of a court".

This is a significant departure from the provisions of the Arbitration Act, 1940. Under the 1940 Act, after the time to set aside the award expired, the court was required to "proceed to pronounce judgment according to the award and upon the judgment so pronounced a decree shall follow" (Section 17). Now the consequence of the time expiring under Section 34 of the 1996 Act is that the award becomes immediately enforceable without any further act of the Court. If there were any residual doubt on the interpretation of the language used in Section 34, the scheme of the 1996 Act would resolve the issue in favour of curtailment of the Court's powers by the exclusion of the operation of Section 5 of the Limitation Act."

3.1 A three Judge Bench of the Supreme Court in Consolidated Engineering Enterprises Vs. Principal Secretary, Irrigation Department and Others reported in [(2008)7 SCC 169] observed as under:-

“When any special statute prescribes certain period of limitation as well as provision for extension upto specified time limit, on sufficient cause being shown, then the period of limitation prescribed under the special law shall prevail and to that extent the provisions of the Limitation Act shall stand excluded. As the intention of the legislature in enacting sub-section (3) of Section 34 of the Act is that the application for setting aside the award should be made within three months and the period can be further extended on sufficient cause being shown by another period of 30 days but not thereafter, provisions of Section 5 of the Limitation Act would not be applicable because the applicability of Section 5 of the Limitation Act stands excluded because of the provisions of Section 29(2) of the Limitation Act. ”

3.2 The Supreme Court while dealing with similar provision in Singh Enterprises vs. CCE reported in (2008) 3 SCC 70 held as under:

“The Commissioner of Central Excise (Appeals) as also the tribunal being creatures of statute are not vested with jurisdiction to condone the delay beyond the permissible period provided under the statute. The period up to which the prayer for condonation can be accepted is statutorily provided. It was submitted that the logic of Section 5 of the Limitation Act, 1963 (in short `the Limitation Act') can be availed for condonation of delay. The first proviso to Section 35 makes the position clear that the appeal has to be preferred within three months from the date of communication to him of the decision or order. However, if the Commissioner is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of 60 days, he can allow it to be presented within a further period of 30 days. In other words, this clearly shows that the appeal has to be filed within 60 days but in terms of the proviso further 30 days' time can be granted by the appellate authority to entertain the appeal. The proviso to sub-section (1) of Section 35 makes the position crystal clear that the appellate authority has no power to allow the appeal to be presented beyond the period of 30 days. The language used makes the position clear that the legislature intended the appellate authority to entertain the appeal by condoning delay only up to 30 days after the expiry of 60 days which is the normal period for preferring appeal. Therefore, there is complete exclusion of Section 5 of the Limitation Act. The Commissioner and the High Court were therefore justified in holding that there was no power to condone the delay after the expiry of 30 days' period.”

3.3 In Commissioner of Customs and Central Excise v. Hongo India (P) Ltd. reported in (2009) 5 SCC 891, another three-Judge Bench of the Supreme Court held as under: -

"As pointed out earlier, the language used in Sections 35, 35- B, 35-EE, 35-G and 35-H makes the position clear that an appeal and reference to the High Court should be made within 180 days only from the date of communication of the decision or order. In other words, the language used in other provisions makes the position clear that the legislature intended the appellate authority to entertain the appeal by condoning the delay only up to 30 days after expiry of 60 days which is the preliminary limitation period for preferring an appeal. In the absence of any clause condoning the delay by showing sufficient cause after the prescribed period, there is complete exclusion of Section 5 of the Limitation Act. The High Court was, therefore, justified in holding that there was no power to condone the delay after expiry of the prescribed period of 180 days."

3.4 In case of Chhattisgarh State Electricity Board v. Central Electricity Regulatory Commission reported in (2010) 5 SCC 23, a two-Judge Bench interpreting Section 125 of the Electricity Act, 2003, which is substantially similar to Section 25(1) of the SICA had noticed as under:-

"Section 125 lays down that any person aggrieved by any decision or order of the Tribunal can file an appeal to this Court within 60 days from the date of communication of the decision or order of the Tribunal. Proviso to Section 125 empowers this Court to entertain an appeal filed within a further period of 60 days if it is satisfied that there was sufficient cause for not filing appeal within the initial period of 60 days. This shows that the period of limitation prescribed for filing appeals under Sections 111(2) and 125 is substantially different from the period prescribed under the Limitation Act for filing suits, etc. The use of the expression "within a further period of not exceeding 60 days" in the proviso to Section 125 makes it clear that the outer limit for filing an appeal is 120 days. There is no provision in the Act under which this Court can entertain an appeal filed against the decision or order of the Tribunal after more than 120 days.

4. In view of the above discussion, power of the appellate authority to condone the delay is limited upto thirty days. There is no legal error in the impugned order of the appellate authority, the writ petition is dismissed.