2015 Supreme(SC) 340

SUPREME COURT OF INDIA
A.K. Sikri, R.F. Nariman, JJ.
M.P. STEEL CORPORATION – APPELLANT
VERSUS
COMMISSIONER OF CENTRAL EXCISE – RESPONDENT
CIVIL APPEAL NO.4367 OF 2004
Decided on: 23-04-2015

MAIN PONITS
Scope, ambit and principles of section 14, Limitation Act, 1963 discussed, explained and applied.
Section 14 is required to be construed in a manner to advance cause of justice.
Condonation of delay and exclusion of period spent in pursuing proceeding in different forum distinguished.
The Limitation Act applies to suits, appeal revisions filed in courts only and not in quasi-judicial bodies. However, its principle should be applied to quasi judicial forums also.
The period from the cause of action till the institution of appellate or revisional proceedings from original proceedings which prove to be abortive are also liable to exclusion.
Period of limitation being procedural in nature should normally have retrospective operation; but not if the amended provision shortens the period of limitation.

Headnote:(a) Limitation Act, 1963 – Section 14 – Appellant not specifically pleading condonation of delay – However they averred that they were pursuing a remedy before another appellate forum – They prayed for excluding the period – Further, conditions 1 to 4 of Consolidated Engg. Enterprises met by appellant – Both proceedings relating to same matter – No negligence, lapse or inaction on part of appellant – He also did not delay the proceedings – Two months time is not inordinate delay – Section 14 attracted. (Para 7)

       (2008) 7 SCC 169 – Referred

       (b) Limitation Act, 1963 – Section 13 and 21, and Schedule r/w section 26, Code of Civil Procedure, 1908 – Suits and appeals are covered by Limitation Act if prescribed court fees are paid – That is why u/s 13 time is excluded in cases where leave to file a suit or an appeal as a pauper is granted – ‘Courts’, therefore, are understood in the strict sense of being part of the Judicial Branch of the State – The Act applies to suits, appeal revisions filed in courts only and not in quasi-judicial bodies. (Para 15, 16)

       1950 SCR 459; (1969) 1 SCC 873; (1969) 2 SCC 199; (1976) 4 SCC 634; (1975) 4 SCC 22; (1996) 9 SCC 414; (2010) 9 SCC 183 – Relied upon

       (1976) 4 SCC 464; (1995) 5 SCC 5 – Distinguished

       (c) Limitation Act, 1963 – Section 14 – Should be liberally construed to advance the cause of justice – Thus it may apply to quasi judicial authorities in civil proceedings, which may include revision but not suits, appeals or applications – Suits, appeals or applications can strico sensu be filed only in courts and to them section 14 applies. (Para 30, 31)

       (2000) 5 SCC 355; (2009) 1 SCC 786 – Relied upon

       (d) Limitation Act, 1963 – Section 14 and section 128, Customs Act, 1962 – Provisions of section 14 do not apply to appeals filed before a quasi-judicial Tribunal such as the Collector (Appeals) mentioned in Section 128 – However, Section 14 is required to be construed in a manner to advance cause of justice – Hence its principles can be applied to an appeal u/s 128. (Para 31, 32)

       (1970) 2 SCR 10; (2009) 12 SCC 175 – Relied upon

       (e) Limitation Act, 1963 – Section 14 r/w section 128, Customs Act – Condoning delay and excluding period spent in pursuing proceeding in different forum – Distinction – The two are different things – If the period is excluded filing of appeal would be within limitation as provided u/s 128 – There is no question of condonation – Held, principle of Section 14 which is based on advancing the cause of justice, would apply to exclude time taken in prosecuting proceedings which are bona fide and with due diligence pursued, which ultimately end without a decision on the merits of the case. (Para 35)

       (2008) 7 SCC 169 – Relied upon

       (1975) 4 SCC 22; (2011) 10 SCC 292; (2015) 3 SCC 353 – Distinguished

       (f) Limitation Act, 1963 – Section 14 – What period to be excluded – Essential ingredient for application of section 14 is absence of negligence or inaction – Section 14 puts the litigant in the same position as if the abortive proceeding had never taken place – Expression “the time during which the plaintiff has been prosecuting with due diligence another civil proceeding” – Needs to be construed in a manner advancing the cause of justice – Therefore, the period from the cause of action till the institution of appellate or revisional proceedings from original proceedings which prove to be abortive are also liable to exclusion. (Para 41, 43)

       AIR 1965 A.P. 388; AIR 1959 MP 271 – Cited with approval

       (g) Interpretation of statute – Retrospectivity – Period of limitation – Procedural in nature – Should normally have retrospective operation – Not if the amended provision shortens the period of limitation. (Para 45)

       (1975) 2 SCC 840; (1991) 4 SCC 333; (1993) 2 SCC 162; (2011) 6 SCC 739 – Relied upon

       (h) Customs Act, 1962 – Section 128 – Pre amended provision providing for limitation of 180 days – Amended provision in 2001 cutting it short to 60 days plus 30 days – Appellant pursuing appeal against order of Collector of Customs before CEGAT which allowed the appeal – It was decided by Supreme Court that CEGAT was not competent to hear the appeal – This the entire period is liable to be excluded from the period of limitation under pre-amended provision – Vested right of appeal had accrued to the Appellant under the pre-amended section 128 – Hence limitation period under amended provision will not apply – After excluding the period spent before CEGAT and Supreme Court, residuary period still remains under pre-amended provision within which proper appeal could be filed. (Para 52)

       Facts of the case:

       The appellant, engaged in ship breaking activity at Alang Ship Breaking Yard, imported a vessel, namely, M.V. Olinda, for the purpose of breaking the same, and filed a Bill of Entry when the vessel was imported on 7.2.1992.

       It declared in the said Bill of Entry that the Light Displacement Tonnage of the vessel was 7009 metric tons.

       On 19.2.1992, the appellant was informed by the Superintendent of Customs and Central Excise Alang that the Light Displacement Tonnage of the ship is actually 8570 tons and that customs duty was to be levied on this tonnage.

       On 3.3.1992, the appellant cleared the vessel on payment of customs duty on the basis of 7009 metric tons and executed a bank guarantee for Rs.19,90,275/- being the difference in customs duty on 1561 metric tons.

       On 25.3.1992, the Collector of Customs, Rajkot, directed the Assistant Collector, Bhavnagar to encash the bank guarantee furnished by the appellant. The bank guarantee was duly encashed on 3.4.1992.

       After protesting against the said illegal action of the Department in encashing the bank guarantee, the appellant preferred an appeal against the Superintendent’s letter dated 2.4.1992 and the Collector’s order dated 25.3.1992 before CEGAT. On 23.6.1998, the Appellate Tribunal allowed the appeal and set aside the order of the Collector dated 25.3.1992. In the year 2000, the Department preferred an appeal before Supreme Court which was allowed.

       On 23.5.2003, the appellant filed an appeal before the Commissioner (Appeals) against the order passed by the Superintendent, Customs dated 2.4.1992. On 4.8.2003, an application to condone delay in filing the appeal was made.

       The Commissioner of Customs (Appeals) dismissed the appeal on the ground of delay.

       CESTAT dismissed the appeal of the appellant stating that the Commissioner (Appeals) had no power to condone delay beyond the period specified in Section 128.

       Finding of the Court:

       The period spent before CEGAT and Supreme Court has to be excluded for purposes of limitation which will be governed by the pre-amended section 128.

       Result:

       Appeal allowed.