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REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL      APPEAL     NO.       7696          OF     2012   (Arising out of SLP (C ) No. 4356 of 2011)

M/s Thakker Shipping P. Ltd. …. Appellant

Versus   

Commissioner of Customs (General)                             ….Respondent

JUDGMENT

R.M.     Lodha,     J.      

Leave granted.  

2. The High Court answered in the affirmative  the following question:

“Whether the CESTAT  has discretionary power under  Section 129A (5) of the Customs Act, 1962  to condone the  delay caused in filing the appeal under Section 129D(3) [sic,  129D(4)] of the said Act, when there was sufficient cause  available to  appellant for not filing it within the prescribed  period before the Appellate Authority”.   

3. The facts leading to the present appeal are these.  A container was  

intercepted by M & P Wing of Commissioner of Customs (Preventive),  

Mumbai on 11.01.2001.  It was found to contain assorted electrical and  

electronic goods of foreign origin.  The said goods were imported by M/s  

Qureshi International  and the cargo was cleared from Nhava Sheva.  The  

clearance of the goods was handled by  M/s Thakker Shipping P. Ltd., the

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appellant, referred to as the Custom House Agent (‘CHA’  for short).  On  

physical verification, the value of seized cargo was estimated at Rs.  

77,10,000/- as local market value as against the declared value of Rs.  

10,03,690/-.  The importer could not be interrogated.  On search of  premises  

of CHA, the books relating to import export  clearance were  not found for  

verification.  In the  statement of Vijay Thakker, proprietor of the CHA,  

recorded  under Section 108 of the Customs Act, 1962 (for short, ‘the Act’),  

he accepted that he attended the import clearance work and introduced the  

importer  to the overseas suppliers  and bankers for  financial assistance;  

the  bill of entry for the clearance of subject goods had been filed without  

proper description and correct value and he failed to inform the Customs  

Officers about the subject goods, despite having attended the examination of  

5%  goods  prior to the clearance.   Accordingly, the inquiry officer recorded  

his findings.  

4. Initially, the appellant’s CHA   licence was placed under suspension  

pending inquiry under Regulation 23 of Custom House Agent Licencing  

Regulations, 2004   but the suspension order  was   set aside by the  

Customs, Excise and Service Tax Appellate Tribunal (for short, ‘Tribunal’)  

and CHA licence was restored.  The inquiry under Regulation 23, however,  

proceeded against the CHA on diverse charges.  The Commissioner of  

Customs (General) Mumbai by his  order  in original dated  21.07.2004  

dropped  the proceedings under Regulation 23 by rejecting the findings of the  

inquiry officer.  

5. The Committee of Chief Commissioners of Customs (for short, ‘the

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Committee’) constituted  under sub section (1B) of Section 129A of the Act  

called for and examined the records of the proceedings leading to order in  

original dated 21.07.2004 passed by the Commissioner of Customs  

(General) Mumbai  (for short, ‘the Commissioner’) for satisfying itself as to  

the legality and propriety of the said order.    The Committee on  

consideration  of the entire matter  directed the Commissioner  to apply to the  

Tribunal for determination of the following points, namely; (1) whether taking  

into consideration  the facts and circumstances noticed in the order, the order  

of the Commissioner was legally  correct and proper;   and (2)  whether by an  

order under Section 129B of the Act, the Tribunal should set  aside the order  

of the Commissioner dropping the proceedings against the CHA.  

6.  The Commissioner, accordingly,  made an application under  

Section 129D(4)  of the Act before the Tribunal.  As the said application could  

not be made within the prescribed period and was delayed by 10 days, an  

application for condonation of   delay was filed with a  prayer for condonation.  

The Tribunal on 28.11.2005,  however, rejected  the application for  

condonation of delay and consequently  dismissed the appeal by the  

following brief order:

“This appeal has been filed  by the applicant Commissioner in  pursuance of Order of Review passed by a Committee of Chief  Commissioners.  In the application for condonation of delay filed  by the applicant Commissioner, a prayer has been made for  condoning delay of 10 days.  In the case of CCEx. Mumbai vs.  Azo Dye Chem-2000 (120) ELT 201 (Tri-LB), Larger Bench of the  Tribunal has  held that the Tribunal has no power to condone the  delay caused in filing such appeals by the Department beyond the  prescribed period of three months.  Even though the said decision  was in a central Excise case, the ratio of this decision is equally  applicable to  Customs cases since the legal provisions  under  both the enactments are similar.  2.  Accordingly,  following  the ratio of Azo  Dye Chem (Supra),

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we have no option but to reject the application for condonation  of delay.  We order accordingly and consequently, the appeal  also stands dismissed”.  

7. This appeal raises the question, whether  it is competent for the  

Tribunal to invoke Section 129A(5) of the Act where an application under  

Section 129D(4) has not been made by the Commissioner within the  

prescribed time and condone the delay in making such application if it is  

satisfied that there was sufficient cause for not presenting it within that  

period.  

8. Learned counsel for the appellant  submitted that Section 129D(4)  

of the Act was self contained and if the application contemplated therein was  

not made within the prescribed period, the Tribunal has no power or  

competence to condone the delay after expiry of the prescribed period.  In  

support of his arguments he relied upon a larger Bench decision of the  

Customs, Excise and Gold (Control) Appellate Tribunal (‘CEGAT’)  in  

Commissioner of Central Excise v. Azo Dye Chem1.  He also placed heavy  

reliance upon a three-Judge Bench decision of this Court in Commissioner of  

Customs and Central Excise v. Hongo India Pvt. Ltd. and Another2. Learned  

counsel  for the appellant also placed reliance upon decisions of this Court in  

Delhi Cloth and General Mills Co. Ltd. v. State of Rajasthan and Ors.3,  

Fairgrowth Investments Ltd. v. Custodian4 and UCO Bank and Anr. v.  

Rajinder Lal Capoor.5  

9. On the other hand,  Mr. R.P. Bhatt, learned  senior counsel  

1  (2000) 120 ELT 201 (Tri-Delhi) 2  (2009) 5 SCC 791 3  (1996) 2 SCC 449 4  (2004) 11 SCC 472 5  (2008) 5 SCC 257

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for the respondent, supported the view of  the High Court in passing the  

impugned order.  He submitted that the answer  to the question under  

consideration was dependent  on construction of Sections 129D and 129A of  

the Act.  

10.  Section 129D (omitting the  parts not relevant)  reads:  

“S.129D. -Power of Committee of Chief Commissioners of  Customs or Commissioner of Customs to pass certain orders. –  (1) The Committee of Chief Commissioners of Customs may, of its  own motion, call for and examine the record of any proceeding in  which a Commissioner of Customs as an adjudicating authority  has passed any decision or order under this Act for the purpose of  satisfying itself as to the legality or propriety of any such decision  or order and may, by order, direct such Commissioner ... to apply  to the Appellate    Tribunal … for the determination of such points  arising out of the decision or order as may be specified by the  Committee of Chief Commissioners of Customs in its order;  … ……………………………………………………………………..

….. …………………………………………………………… The Committee of Chief Commissioners of Customs   … shall make order  under sub-section (1) …. within a period of three months from the date of  communication of the decision or order of the adjudicating authority; Where in pursuance of an order under sub-section (1)  …. Commissioner of  Customs makes an application to the Appellate  Tribunal  …. within three  months from the date of communication of the order under sub-section (1)  …. such application shall be heard by the Appellate Tribunal  …. as   if such  applications were an appeal made against the decision or order of the  adjudicating authority and the provisions of this Act regarding appeals,  including the provisions of sub-section (4) of Section 129A shall, so far as  may be, apply to such application.  …………………………………………………………………”

We may clarify that sub-sections (3) and (4) of Section 129D have been  

amended from time to time.  What has been reproduced above are the  

provisions existing at the relevant time.   

11. Section 129A (omitting the  parts not relevant)  reads:  

“S.129. - Appellate Tribunal. – (1) ……………………………………………………………….. (2) …………………………………………………………..  (3) Every appeal under this section shall be filed within  three

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months from the date on which the order sought to be appealed  against is communicated to the Commissioner of Customs, or as  the case may be, the other party preferring  the appeal.  (4)On receipt of notice that an appeal has been preferred under  this section, the party against whom the appeal has been  preferred may, notwithstanding that he may not have appealed  against such order or any part thereof, file, within forty-five days of  the receipt of the notice, a memorandum of cross-objections  verified in such manner as may be specified by rules made in this  behalf against any part of the order appealed against and such  memorandum shall be disposed of by the Appellate Tribunal as if it  were an appeal presented within the time specified in sub-section  (3).    (5) The Appellate Tribunal may admit an appeal or permit the filing  of a memorandum of cross-objections after expiry of the relevant  period referred to in sub-section (3) or sub-section (4), if it is  satisfied that there was sufficient cause for not presenting it within  that period”.

12. Section 129D(4) makes it clear that where an application is made by  

the Commissioner to the Tribunal in pursuance of an order under sub-section  

(1) within a prescribed period from the date of communication of that order,  

such application shall be heard by the Tribunal  as if  it was an appeal made  

against the decision or order of  the adjudicating authority and the provisions  

regarding appeals under Section 129A to the Tribunal, in so far as they are  

applicable, would be applicable to such application.  The crucial words  and  

expressions in  Section 129D(4) are, “such  application”, “heard”, “as if such  

application were an appeal”  and “so far as may be”.   The expression “such  

application”, inter alia, is referable to the application made by the  

Commissioner to the  Tribunal in pursuance of an order under sub-section (1)  

of Section 129D.  The period prescribed in Section 129D for making  

application does not control the expression  “such application”.  It is difficult to  

understand how an application made under Section 129D(4) pursuant to the  

order passed under sub-sections (1) or (2) shall cease to be “such application”

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merely because it has not been made within prescribed time.  If the  

construction to the words “such application”  is given to mean an application  

filed by the Commissioner before the Tribunal within the prescribed period  

only, the subsequent expressions “heard”, “as if such an application were  an  

appeal’” and   “so far as may be” occurring in Section 129D(4) of the Act may  

be rendered ineffective.   The view of the larger Bench of the CEGAT  in Azo  

Dye Chem1  and the reasons in support thereof do  not commend to us.  We  

are unable to accept the view  adumbrated by the CEGAT.  The clear and  

unambiguous provision in Section 129D(4) that the application made therein  

shall be heard by the Tribunal as if it was an appeal made against the  

decision or order of the adjudicating authority and the provisions of the Act  

regarding appeals,  so far as may be,  shall apply to such application leaves  

no manner of doubt that the provisions of Section 129A (1) to (7)  have been  

mutatis mutandis made applicable,  with due alteration  wherever necessary,  

to the applications under Section 129D(4).   

13. From the plain language of Section 129D(4), it is clear that  Section  

129A has been incorporated in Section 129D. For the sake of brevity, instead  

of repeating  what has been provided in Section 129A as regards the appeals  

to the Tribunal,   it has been provided that the applications made by the  

Commissioner under Section 129D(4) shall be heard as if they were appeals  

made against the decision or order of the adjudicating authority and the  

provisions relating to the appeals to the Tribunal shall be applicable in so far  

as they may be applicable.  Consequentially, Section 129A(5) has become  

integral part of Section 129D(4) of the Act.   In other words, if the Tribunal  is

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satisfied that there was sufficient cause for not presenting the application  

under Section 129D(4)  within prescribed period,  it may condone the delay in  

making such application and hear the same.    

14. Parliament intended entire Section 129A, as far as applicable, to be  

supplemental to Section 129D(4)  and that is why it provided that the  

provisions relating to the appeals to the Tribunal shall be applicable to the  

applications made under Section 129D(4).  The expression, “including the  

provisions of sub-section (4) of Section 129A”  is by way of clarification and  

has been so said expressly to remove any doubt about the applicability of the  

provision relating to cross objections  to the applications made under Section  

129D(4) or else it may be said that provisions relating to appeals to the  

Tribunal have been made applicable and not the cross objections.   The use  

of expression  “so far as may be” is to bring  general provisions  relating to the  

appeals to Tribunal  into Section 129D(4).  Once the provisions relating to the  

appeals to the Tribunal have been made applicable,  Section 129A(5)  stands  

incorporated in Section 129D(4)  by way of legal fiction and must be given  

effect to.  Seen thus, it becomes clear that the Act has given express   power  

to the Tribunal to condone  delay in making the application under Section  

129D(4) if it is satisfied that there was sufficient cause for not  presenting it  

within that period.  

15. We do not think that any useful purpose will be served in discussing  

the cases  cited by the learned counsel for the appellant in detail.   In none of  

these cases, the question  which has come up for decision in the present

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appeal arose.  We shall, however, briefly refer to these decisions.  

16. In Hongo India Pvt. Ltd2, the question for consideration  

before this Court was whether the High Court had power to condone the delay  

in presentation of the reference application under unamended Section 35-H(1)  

of the Central Excise Act, 1944 beyond the prescribed period by applying  

Section 5 of the Limitation Act, 1963.  Sub-section  (1) of Section 35-H, which  

was under consideration before this Court,  read as follows:    

“35-H.  Application to High Court. –  (1) The Commissioner of  Central Excise or the other party may, within one hundred and  eighty days of the date upon which he is served with notice of an  order under Section 35-C passed before the 1st day of July, 2003  (not being an order relating, among other things, to the  determination of any question having a relation to the rate of duty  of excise or to the value of goods for purposes of assessment), by  application in the prescribed form, accompanied, where the  application is made by the other party, by a fee of two hundred  rupees, apply to the High Court to direct the Appellate  Tribunal to  refer to the High Court any question of law arising from such order  of the Tribunal”.  

This Court observed that except providing a period of 180 days for filing  

reference application to the High Court, there was no other clause for  

condoning the delay if reference was made beyond the said prescribed  

period.  Sections 5 and 29(2) of the Limitation Act  were noted.  This Court  

then held that 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 and in the absence of any clause condoning the delay by  

showing sufficient cause after the prescribed period, there was complete  

exclusion of Section 5 of the Limitation Act.  In conclusion this Court  held that

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the time limit prescribed under Section 35-H(1) to make a reference  to the  

High Court was absolute  and unextendable by the Court under Section 5 of  

the Limitation Act.  In the present case, as noted above, the provisions  

relating to the appeals to the Tribunal have been made applicable to an  

application  made under Section 129D(4)  and it has been further provided  

that such application shall be heard as if  it was an appeal made against the  

decision or order of the adjudicating authority.   Any delay in presentation of  

appeal under Section 129A is condonable by the Tribunal by virtue of sub-

section (5) thereof.  The Tribunal has been invested with the same power for  

consideration of the applications under Section 129D(4) if it is satisfied that  

there was sufficient cause for not presenting such application within  

prescribed  period as the provisions relating to the appeals to the Tribunal  

have been made applicable to such applications.   Hongo India Pvt. Ltd2  

does not help the appellant at all.  

17. In Delhi Cloth and General Mills Co. Ltd3.  the concept  of legal  

fiction has been explained.  This Court observed,  “the legal consequences  

cannot be deemed nor, therefrom,  can the events that should have preceded  

it.  Facts may be deemed and,  therefrom, the legal consequences that  

follow”.     

18. In  Fairgrowth Investments Ltd.4, the question raised   before this  

Court was whether the Special Court constituted under the Special Court  

(Trial  of Offences Relating to Transactions in Securities) Act, 1992 (for  short,  

‘1992 Act’) has power to condone the delay in filing a petition under  Section

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4(2)  of the Act.   Dealing with the said question, the Court considered various  

provisions of the Limitation Act, including Sections 5 and 29(2), and ultimately  

it was held that the provisions of the Limitation Act had no application in  

relation to a petition under Section 4(2) of the 1992 Act and the prescribed  

period was not extendable by the Court.    

19. In UCO Bank.5, this Court restated,  what has  been stated earlier  

with regard to interpretation of statutes, that the court must give effect to  

purport and object of the enactment.    

20. In light of the above discussion, we hold that it is competent for  the  

Tribunal to invoke Section 129A(5) where an application under Section  

129D(4) has not been made within the prescribed time and condone the  

delay in making such application if it is satisfied that there was sufficient  

cause for not presenting  it within that period.  

21. In view of the above, the appeal must fail and it fails and is  

dismissed with no  order as to  costs.   

…………………..J.   (R.M. Lodha)

…………………..J.  (Anil R. Dave)  

NEW DELHI OCTOBER 30, 2012.