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Judgment
B.R. Gavai, J.—Rule. Rule made returnable forthwith. Heard by consent.
The petitioners have approached this Court being aggrieved by the order dated 12.1.2012 in Misc. Application Nos. 55 of 2010 and 118 of 2010 along with the Second Appeal No. 179 of 2010, whereby dismissing the application of the present petitioners for condonation of delay and also consequently, dismissing the Second Appeal.
The facts, in brief, giving rise to the present petition, are as under:--
"(a) The petitioner, which is a Company duly registered under the provisions of the Companies Act, is registered under the provisions of the Bombay Sales Act, 1959 (hereinafter referred to as "the said Act", for short) and the Central Sales Tax Act, 1956 (hereinafter referred to as "the Central Act" for short).
(b) The present petition is concerned with the assessment year for the period 1992-93. The petitioner was assessed for the Sales Tax liability for the said assessment year on 19.2.1998, Being aggrieved thereby, the petitioner preferred an appeal on 21.5.1998. However, since the petitioner got some administrative relief vide the order dated 27.1.2000, the petitioner submitted an application on 22.2.2000 thereby seeking leave to partially withdraw the grounds of appeal in relation to which the petitioner had got administrative relief. However, it appears that vide the order dated 20.6.2000, all the appeals of the assess for various periods were clubbed by the Appellate Authority with the appeals for Assessment Year 1992-93 and thereby dismissed all the appeals as withdrawn. It is the contention of the petitioners that they were under an impression that the appeal is only partly disposed off and the appeal still remains pending before the first Appellate Authority insofar as the part of the claim about which no relief was granted is concerned. It is the contention of the petitioners that only on 1.4.2010, i.e. after receipt of the demand for recovery, the petitioners realized that entire appeal has been dismissed and therefore found it necessary to file a Second Appeal before the learned Tribunal. In this background, the petitioners had filed a Second Appeal along with an application for condonation of delay. The same is rejected by the impugned order. The rectification application filed has also been dismissed. Hence, the present petition."
Smt. Badheka, the learned counsel appearing for the petitioners submits that the petitioners were under bonafide impression that the appeal was only partly withdrawn and was pending in part. The learned counsel submits that one Shri Himanshu Kothari, who is consultant of the petitioners had advised the petitioners that the appeal is pending in part and as such, the petitioners were not aware that the appeal was dismissed in entirety, thereby finding it necessary to file an appeal against part of the order with which the petitioners were aggrieved. It is submitted that not only that, but when the demand was received by the petitioners vide communication dated 24.4.2007, the petitioners had immediately addressed a communication on 7.5.2007, wherein it is categorically stated that the appeal was pending before the first Appellate Authority. It is submitted that thereafter only for the first time when the petitioners received another demand notice in March 2010, an enquiry was made wherein it was found that the appeal was dismissed in entirety. It is submitted that in these circumstances, the Second Appeal and the application, as aforesaid, came to be filed.
Smt. Badheka learned counsel appearing on behalf of the petitioners submits that the learned Tribunal has erred in dismissing the application for condonation of delay and, consequently, dismissing the Second Appeal. She submits that merely because there is delay of around nine years, could not have been a ground for dismissing the application. The learned counsel submits that what is required to be seen while considering the application for condonation of delay, is as to whether a case for sufficient cause for not filing he appeal was made out by a party or not. The learned counsel submits that the petitioners had already filed on record an affidavit from Shri Himanshu Kothari, which would fortify the case of the petitioners, that the petitioners were under bonafide impression that the appeal was still pending in part and as such, ought to have taken a liberal view. It is submitted that Mr. Kothari had also given details regarding his wife''s illness who was suffering from various ailments. She further submits that the petitioners had further stated that one Mr. Mehboob Punjnani, who was an employee of the appellant and was looking after the said matter had also left the services of the appellant in or around 2005. She further submits that the learned Tribunal has also failed to take into consideration the facts given in the affidavit of Mahendra Shantaram Gayatonde, who was the authorized representative of the company.
Smt. Helekar, the learned AGP appearing for the Revenue vehemently opposes the petition. She submits that there was gross and inordinate delay, which is not at all explained by the petitioners. The learned counsel for the Revenue submits that, even from the material placed on record it will reveal that the petitioners were not at all diligent in prosecuting the matter. She submits that the learned Tribunal has correctly applied the law and found that no case for condonation of delay is made out. The learned counsel, therefore, submits that the petition deserves to be dismissed.
By now, it is settled principles of law that the period of delay is not relevant for considering the application for condonation of delay. What is required to be seen is as to whether a party seeking condonation of delay has made out a "sufficient cause or not". The Apex Court in the case of Collector, Land Acquisition, Anantnag and Another Vs. Mst. Katiji and Others, AIR 1987 SC 1353 : (1987) 13 ECC 27 : (1988) 19 ECR 565 : (1987) 28 ELT 185 : (1987) 167 ITR 471 : (1987) 1 JT 537 : (1987) 1 LLJ 500 : (1987) 1 SCALE 413 : (1987) 2 SCC 107 : (1987) 2 SCR 387 : (1987) 66 STC 228 : (1987) 2 UJ 29 , has also held that while considering as to whether a sufficient cause is made or not the Courts should take a liberal view of the matter.
In this background, let us consider the present case.
Undisputably, after the assessment order was passed by the original Authority on 19.2.1998, First Appeal was preferred by the petitioners before the First Appellate Authority. It can also be seen that when the administrative relief order was passed on 27.1.2000, a part of the claim of the petitioner stood satisfied. As such, an application came to be filed by the petitioners on 22.2.2000. It will be relevant to refer to the following portion of the letter dated 22.2.2000:--
"(ii) In view of the above, we hereby withdraw the Point of Objection and Grounds of Appeal relating to calculation of CQB.
(iii) However, the other Points of Objection and Grounds of Appeal, if any, as per our Appeal Petition are still being contested and not withdrawn."
It would thus be clear that the petitioner had only withdrawn the appeal insofar as the objection and ground of appeal relating to calculation of Cumulative Quantum of Benefit. It would further reveal that the appellant had clearly stated that the other points and objections and grounds of appeal are still contested and not withdrawn. It however appears that the First Appellate Authority, since there was a bunch of appeals, decided all the appeals and dismissed all of them as withdrawn along with the present appeal.
An affidavit has been filed before the learned Tribunal by Shri Kothari who was consultant. He has stated that after the order was passed by the appellate Authority, he had approached the Appellate Authority and informed that the request made by the petitioners for withdrawal of appeal was only in part. He has stated that the learned Deputy Commissioner, who was looking after the matter at that time, had noticed the said error and assured him that necessary correction would be done. He has also stated in the affidavit that his wife was suffering from multiple serious health problem since last so many years. She was required to undergo almost 12 surgeries. He has further stated that when a demand was made by the Respondent-Authority in 2007, in reply thereto, it was categorically stated that the appeal is still pending. He further stated that after the reply was sent, there was no further communication for the period of almost three years and after three years in 2010, another demand was issued. It is stated that at this point of time, the petitioners realized that there was something which required immediate action and as such upon consulting a lawyer, it was decided to file Second Appeal along with an application for condonation of delay.
As already discussed hereinabove, the letter requesting the Appellate Authority on 22.2.2000 is only for partial withdrawal of the appeal and not entire appeal. Shri Kothari in the affidavit categorically stated that he has immediately pointed out the error committed by the Appellate Authority in the order dated 30.6.2000 and the Appellate Authority had assured to rectify the errors. He has further stated that since 2000 till 2007, there was no action from the Department and as such he was under bonafide belief that the Appellate Authority had accepted his contention and would do necessary correction. It is further evident that after receipt of the communication dated 24.4.2007 demanding the amount for the aforesaid assessment year, a reply was immediately sent by the petitioners on 7.5.2007 to the Respondent-Authority, wherein again it was specifically stated that the appeal is still pending and the petitioner was waiting for the final hearing. On a specific query as to whether the said letter is replied to the petitioners, Smt. Helekar, the learned AGP for the Revenue, on instructions from the officer, who is present in Court, fairly states that no such reply was sent to the petitioner. Again for a period of three years, there was nothing from the end of the Respondents. Only after three years again a demand was made and at that point of time, the petitioner found it necessary to consult a lawyer and take appropriate steps. Immediately thereafter, an appeal along with application for condonation of delay is filed. As already discussed hereinabove, length of delay is not relevant. What is relevant is as to whether a party has made out a case of sufficient cause or not. The letter requesting withdrawal categorically states withdrawal of the appeal is only for a claim in respect of which the administrative relief has been given to the petitioner. No doubt that the order disposing of the appeal states that Appeal has been withdrawn in toto. However, Shri Kothari categorically stated in his affidavit that he had brought the errors to the notice of the Appellate Authority and it assured to do so necessary correction. His bonafide belief that the necessary correction would be made is also fortified, from the fact that from 2000 till 2007, nothing was done by the Respondents. When in 2007, a reply is given that the appeal is still pending, neither the said letter is replied to nor any immediate action is taken for recovery of the amount. Only after a period of three years the second notice is issued.
It can thus be clearly seen that the contention of the petitioners that they were under bonafide belief that the appeal is still pending stands fortified from the facts narrated hereinabove and from the affidavits placed on record. It is further to be noted that though the petitioners had requested for withdrawal of appeal in part, the Appellate Authority erroneously dismissed the appeal as withdrawn in toto. By now, it is well-settled principle of law that the act of Court shall prejudice none. Reliance in this respect shall be placed on the Judgment of the Apex Court in the case of Gursharan Singh and others etc. Vs. New Delhi Municipal Committee and others, (1996) 2 AD 48 : AIR 1996 SC 1175 : (1996) 1 JT 647 : (1996) 1 SCALE 615 : (1996) 2 SCC 459 : (1996) 1 SCR 1154 : (1996) 1 UJ 628 . The Appellate Authority acting under the said Act, acts in a quasi-judicial capacity. On account of an error which is committed by a quasi-judicial authority, and which according to the affidavit filed on behalf of the appellant, was assured to be corrected by him, but however not corrected by him, a prejudice cannot be permitted to be caused to a litigant who was acting bonafide.
In that view of the matter, we find that the petitioners have made out a case of sufficient cause and as such, have made out a case for condonation of delay. However, the same shall be subject to costs which are quantified at Rs. 10,000/- (Rupees ten thousand only).
The impugned order is, therefore, quashed and set aside. The application field by the present petitioners for condonation of delay is allowed, subject to costs which are quantified at Rs. 10,000/-. Consequently, the Second Appeal filed by the petitioner shall stand restored to the File of the learned Tribunal and the learned Tribunal is requested to decide the appeal on its own merits in accordance with law. Rule is made absolute in terms of prayer clauses (b), (c), (d) and (e).