LASER PARAXIS DEPLIEX CLINIC, LAHORE VS CUSTOMS, CENTRAL EXCISE AND SALES TAX APPELLATE TRIBUNAL, LAHORE BENCH, CUSTOM HOUSE, LAHORE,
2002 P T D 549
[Lahore High Court]
Before Naseem Sikandar and Mansoor Ahmad , JJ
LASER PARAXIS DEPLIEX CLINIC, LAHORE
versus
CUSTOMS, CENTRAL EXCISE AND SALES TAX APPELLATE TRIBUNAL, LAHORE BENCH, CUSTOM HOUSE, LAHORE,
C.A. No.323 of 2001, heard on 01/11/2001.
(a) Sales Tax Act (VII of 1990)‑‑‑
‑‑‑‑S.46(2)‑‑‑Limitation Act (IX of 1908), S.5‑‑‑Condonation of delay‑‑ Power under _ Sales Tax Act, , 1990 and Limitation Act, 1908‑‑ Comparison‑‑‑Power conferred upon Tribunal under S.46(2) of the Sales Tax Act, 1990; is wider than the one contained in S.5 of the Limitation Act, 1908‑‑‑Reason for such difference is that the notion of accrual of valuable right ‑ to an adversary after the lapse of limitation in ordinary cases of civil nature is not generally applicable to the matters of Revenue‑‑‑As in such cases it is always the State against a citizen or assessee, the interest of immediate recovery. cannot be described as accrual of a valuable right‑‑‑Even otherwise the kind of right coming into being by reason of default of a party to approach a particular forum within a specified time‑is not an absolute right nor does it frustrate exercise of judicial discretion wherever a condonation is provided for in a statute‑‑‑Tax in every form is an exaction of money from the subject and its recovery when becomes due is not generally hit by any limitation in terms of time‑‑‑Recovery of Revenue by State certainly contains an element of public interest‑‑‑Such interest cannot be equated with the accrual of a valuable right which an individual may normally acquire against another‑‑‑In matters of .civil nature the basic purpose to curtail litigation by law of limitation is to bring the proceedings to a foreseeable end and to clothe them with finality so that people may feel secure in their rights to their person and property when the prescribed limitation has run out‑‑‑In Revenue matters, on the other hand, a demand once created and duly conveyed to the subject is not conditional to a fixed period of recovery nor does it lapse if not recovered within a certain period‑‑‑Demand created in accordance with law is a sword which keeps on hanging on the head of a citizen till the liability is discharged‑‑ Revenue Authorities, though an equal party before Tribunal are certainly at an advantageous position vis‑a‑vis the assessee, therefore, it is necessary that the prescribed limit in the statute and the discretion given therein to the Tribunal should be exercised objectively‑‑‑Every request for condonation of delay should not be allowed as a matter of course‑‑‑Prayer for condonation of delay whether it is from the assessee or the Revenue, must not be considered when it, is found to be contumacious and frivolous‑‑‑Exercise of discretion in favour of an indolent appellant would certainly be detrimental to the judicial system.
Abdul Waheed v. State PLD 1960 (W.P.) Lah. 85 ref.
(b) Sales Tax Act (VII of 1990)‑‑‑
‑‑‑‑S.46(2)‑‑‑Limitation Act (IX of 1908), S.5‑‑‑Condonation of delay‑‑ Term `sufficient cause'‑‑‑Connotation‑‑‑To condone or not to condone a delay rests upon consideration of `sufficient cause' and the same actually means the peculiar circumstances of that very case‑‑‑Every case needs to be considered keeping in view the facts obtaining therein‑‑‑There cannot be a precise definition of 'sufficient cause' nor there can possibly be laid down the exact parameters which can fit in the situation in every case‑‑ Attempt to define `sufficient cause' would amount to curtail judicial power and discretion which the Legislature has left open and unfettered in the forum.
(c) Sales Tax Act (VII of 1990)‑‑‑
‑‑‑‑S.46(2)‑‑‑Limitation Act (IX of 1908), S.14‑‑‑Condonation of delay‑‑ Exclusion of time taken in proceedings bona fide in Court without jurisdiction‑‑‑Jurisdiction . of Tribunal‑‑=Scope‑‑‑Although there are no specific provisions in Sales Tax Act, 1990, equivalent to S.14 of the Limitation Act, 1908, which provide for exclusion of time yet the Tribunal is legally competent to consider the submissions in the context of the `sufficient cause' being placed before them‑‑‑Delay may be condoned by Tribunal accordingly.
(d) Limitation Act (IX 6f 1908)‑‑‑
‑‑‑‑S.5‑‑‑Sales Tax Act (VII of 1990), S.46(2)‑‑‑Condonation of delay‑‑ Principles to be followed.
Following are the principles which must be kept in mind by every judicial or quasi judicial forum while dealing with questions of condonation of delays:‑‑‑
(i) Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
(ii) Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is. condoned the highest that can happen is that a cause would be decided on merits after hearing the parties.
(iii) `Every day's delay must be explained' does not mean that a' pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, common sense and pragmatic manner:
(iv) When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non‑deliberate delay.
(v) There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk.
(vi) It must be grasped that the judiciary is respected not on. account of its power to legalize injustice on technical grounds but because it it capable of removing injustice and is expected to do so.
Controller, Land Acquisition v. Mst. Katiji and others (1987) 56 Tax 130 rel.
(e) Sales Tax Act (VII of 1990)‑‑‑
‑‑‑‑S.46(2)‑‑‑Limitation Act (IX of 1908), S.14‑‑‑Condonation of delay‑‑ Exclusion of time taken in proceedings bona fide in Court without jurisdiction‑‑‑Against notice of recovery, instead of filing appeal, the appellant made representation to the Department to reconsider the decision‑‑‑Appellant, having received no response from the Department, filed Constitutional petition and only after the decision of the High Court, the appellant filed appeal before Customs, Central Excise and Sales Tax Appellate Tribunal‑‑‑Tribunal refused to condone the delay and the appeal was dismissed as time‑barred‑‑‑Validity‑‑‑Prayer for condonation of delay in the present case was neither contumacious nor the appellant could possibly gain .anything by deliberately knocking at a wrong forum‑‑‑Order of the Tribunal was set aside and the case was remanded to the Tribunal for deciding the same on merits‑‑‑Appeal was allowed accordingly.
Altaf Hussain v. Muhammad Nawaz 2001 SCMR 405; Abdul Majeed and another v. Ghulam Haider and others 2001 SCMR 1254; Chief Administrator of Auqaf v. Muhammad Ramzan PLD 1991 SC 102; Abdul Razzak v. Ch. Sultan Muhammad Khan= Settlement and Rehabilitation Commissioner and others PLJ 1973 Lah. 433; Muhammad Ismail v. Mst. Zubaida Khatoon PLD 1973 Kar. 503; Shib Dayal and another v. Jagannath Prasad 636 All. 44 XICV and Re: Hesly (1894) 1 QB 742 ref.
Naveed Ahmed Andrabi for Appellant.
A. Karim Malik for the Revenue.
Date of hearing: 1st November, 2001.
JUDGMENT
NASEEM SIKANDAR, J.‑‑‑Section 46 of the Sales Tax Act, 1990 provides for appeal to the Appellate Tribunal by any person including the Sales Tax Department within 30 days of the date of communication of an order recorded by the concerned officer of sales tax. Subsection (2) of section 46, however, allows discretion to the Tribunal to admit any appeal preferred after the period of limitation specified in subsection (1) if it is satisfied that there was "sufficient cause", for not presenting the appeal within the specified period.
2. A partnership firm before us on being served with a notice by the Sales Tax Department denied the applicability of the changing provisions of the Act on the ‑basis of nature of services provided by it. However, the department disregarded the contention and by way of order, dated April 28, 2001 found the appellant liable to registration. Instead of filing an appeal before the Tribunal the appellant appears to have made a representation to the department to look into the matter and to reconsider their decision conveyed by way of the aforesaid letter. Having received no response from the department the appellant approached this Court in Constitutional Petition No.1265712001 which was disposed of by Mr. Justice Jawwad S. Khawaja with the: observations that the petitioner could avail the remedies available to it under the Sales Tax Act, 1990.
3. Thereupon the appellant filed an appeal before the Tribunal which was coupled with an application to condone the delay on the ground that of its having been agitating the matter bona fide before a wrong forum. The learned Division Bench of the Tribunal by way of impugned order, dated 4‑9‑2001, however, refused to condone the admitted delay of 43 days. After considering the case law relied upon by the appellant before them including re: Altaf Hussain v. Muhammad Nawaz 2001 SCMR 405 and re: Abdul Majeed and another v. Ghulam Haider and others 2001 SCMR 1254, the learned Tribunal refused to condone the delay. Also it was found that in the facts before them the ratio settled in re: Chief Administrator of Auqaf v. Muhammad Ramzan PLD 1991 SC 102 cited at the bar for the department was clearly attracted. Accordingly the application seeking condonation of delay was rejected and the appeal was dismissed being barred by time.
4. Heard the learned counsel for the parties. Learned counsel for the appellant has relied upon the aforesaid judgments earlier cited before the Tribunal while the learned counsel for the Revenue has further placed reliance upon re: Abdul Razzak v. Ch. Sultan Muhammad Khan, Settlement and Rehabilitation Commissioner and others PL1 1973 Lah. 433 and re: Muhammad Ismail v. Mst. Zubaida Khatoon PLD 1973 Kar. 503 to contend that refusal of the Tribunal 'in the given facts is not open to exception.
5. Having considered the submissions made at the bar we are of the view that the power to condone the delay conferred upon the Tribunal under the aforesaid provisions of law is wider than the one contained in section 5 of the Limitation Act, 1908. It is for the reason that the notion of accrual of valuable right to an adversary after the lapse of limitation in ordinary cases of civil nature is not generally applicable to the matters of Revenue. In such cases since it is always the State against a citizen ors assessee, the interest of immediate recovery cannot be described as, accrual of a valuable right. Even otherwise the kind of right coming into being by reason of default of a party to approach a particular forum within a specified time is not an absolute right nor does it frustrate exercise of judicial discretion wherever a condonation is provided for and a statute. It hardly needs emphasis that tax in every form is an exaction of money from the subject and its recovery when becomes due does not generally hit by any limitation in terms of time. The recovery of! Revenue by State certainly contains at: element of public interest. However, such interest cannot be equated with the accrual of a valuable right which an individual may normally acquire against another. In red Abdul Waheed v. The State PLD 1960 (W.P.) Lah. 85 this Court condoned the delay under section 5 of the Limitation Act in filing of a criminal appeal on the ground that on delay no valuable right accrued LC the opposite‑party, the State.
6. We have another reason to hold for a liberal interpretation of the aforesaid provisions allowing a discretion to the Tribunal to condone the delay. In matters of civil nature the basic purpose to curtail litigation acv law of limitation is to bring the proceedings to a foreseeable end and to clothe them with finality so that people may feel secure in their rights to their person and property when the prescribed limitation had run out. In Revenue matters, on the other hand, a demand once created and duly conveyed to the subject is not conditional to a fixed period of recovery nor would it automatically lapse if not recovered within a certain period. A demand created in accordance with law is a sword which keeps on hanging on the head of a citizen till the liability is discharged. Then Revenue though an equal party before the Tribunal is certainly at an advantageous position v is‑a‑vis the assessee. Therefore, it is necessary that the prescribes limit in the statute and the discretion given therein to the Tribunal should be exercised objectively. It does not, however, mean that every such request should be allowed as a matter of course. The prayer for condonation whether it is from the assessee or the Revenue must not be considered when it is found to be contumacious anti frivolous. The exercise of discretion in favour of an indolent appellant would certainly be detrimental to the judicial system that we all feel proud of.
7. Another reason for our lenient view of the delay is also peculiar to the tax proceedings when compared with other civil or, criminal litigation. It is the representation oh behalf of a citizen. Generally in proceedings before the Courts of general jurisdiction it is Lawyers or Advocates, who represent the parties while .in tax proceedings particularly those under the Sales Tax Act the representation is allowed to be made by authorized representatives. According to section 52 of the Act a person
required to appear before the Appellate Tribunal or an officer of Sales Tax in connection with any proceedings under the Act can authorize any other person to represent him or appear on his behalf If such authorized representative is not trained in law or a similar branch of knowledge, the yardstick applied in cases of Lawyers and Advocates in the matters of delay should certainly be different. In cases involving pure question of law and legal intricacies it would not be realistic to expect a common man or a representative of an assessee to have the same degree of legal accuman as those who were particularly trained in law or are qualified Accountants. We have precedents from superior Courts even in case of lawyers from Mofussil who were treated leniently when compared with their fraternity engaged in practice at the principal seat of a superior Court. A Full Bench of Allahabad High Court was considering an application under section 5 of the Limitation Act for condonation of delay in re: Shib Dayal and another v. Jagannath Prasad 636 All. 44 XICV, decided on February 27, 1923. The appellant before their Lordships did not file a copy of the order of the Court of first instance which was mandatory. After an objection by the office the required copy was filed. However, in the meantime, the prescribed limitation had already gone. In .the application under section 5 of the Limitation Act it was pleaded by the appellants that their vakil conducting the case at District Courts had advised them _ that filing of order of the original Court was not necessary. During the arguments Justice Stuart suggested deviation from their earlier decisions and proposed following of English precedents after mentioning the case re: Hesly (1894) 1 QB 742. Sir Grimwood Mears, C.J. while speaking for the Bench, however, preferred following of the earlier practice of the Court and to allow the application considering the mistake of the counsel to be a `sufficient cause" for the late filing of copies. The reason that persuaded the Full Bench to allow the request for condonation as a policy being "an honest mistake even though negligent one ought not in the present state of profession in the Districts be allowed to operate to the prejudice of clients".
8. To condone or not to condone a delay certainly rests upon the consideration of "sufficient cause" which actually means the peculiar circumstances of that very case. Every case needs to be considered keeping in view the facts prevailing therein. There cannot, therefore, be a precise definition of "sufficient cause" nor there can possibly be laid down the exact parameters which could fit in the situation in every case. An attempt to define "sufficient cause" would amount to curtail judicial power and discretion which the Legislature has left open and unfettered in the forum which in this case is the Tribunal. Some general principles have, however, been laid down by the superior Courts. In 636 All. 44 (supra) Justice Prama Charan Benerji though agreeing with the conclusion reached upon by his peers recorded a separate note with these remarks: "what constitutes sufficient cause cannot be laid down by hard and fast rules. The sufficient cause must be determined on a reference to the circumstances of each case. In my opinion the expression "sufficient cause" should be liberally construed so as to advance substantial justice". These findings are being followed by the Courts in both India as well as in Pakistan till date.
9. Although there are no specific provisions in Sales Tax Act equivalent to section 14 of the Limitation Act which provide for exclusion of the time taken in proceedings bona fide in Court' without jurisdiction yet the Tribunal was legally competent to consider the submissions in the context of the "sufficient cause" being placed before them. The case‑law relied upon by the learned counsel for the petitioner before the Tribunal and then before us supported their claim as a general proposition. On the other hand the aforesaid judgments relied upon by the learned counsel for the Revenue are clearly distinguishable. Again for the simple reason that in Revenue matters a prayer" for condonation by an
assessee/citizen must be considered objectively.
10. In re: Controller Land Acquisition v. Mst. Katiji and others (1987) 56 Tax 130 (SC India), their Lordships laid down general principles for adherence while deciding applications for condonation under section 5 of the Limitation Act. These principles in our opinion must be kept in mind by every judicial or quasi‑judicial forum while dealing with questions of condonation of delay.
11. M.P. Thakkar, J. speaking for the Court favoured a justice -oriented approach by finding that:‑‑‑
(i) Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
(ii) Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties.
(iii) `Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, common sense and pragmatic manner.
(iv) When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non‑deliberate delay.
(v) There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk.
(vi) It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.
12. To the above list we would like to add our view expressed earlier that in Revenue matters the prayer for condonation by an assessee/citizen should all the more be considered sympathetically. Our reasons for leniency have already been counted above.
13. Being in‑respectful agreement with the above findings of their Lordships and our own addition to the list, we are of the view that prayer for condonation of delay in the case in hand was neither contumacious nor the appellant could possibly gain anything by deliberately knocking at a wrong forum.
14. Therefore, this appeal is allowed. Resultantly, the appeal filed by the appellant shall be deemed pending before the Tribunal which shall be heard and decided on merits in accordance with law after hearing both the parties.
Q.M.H./M.A.K./L‑29/LAppeal allowed.