CONDONATION OF DELAY – TIME EXCLUDED UNDER LAW OF LIMITATIONS WILL BE EXCLUDED - The period once excluded, cannot be counted for the purpose of computing the period for which delay can be condoned, so held by the Supreme Court.

[DEV KUMAR KOTHARI]

Case under study:

M/S LAXMI SRINIVASA R AND P BOILED RICE MILL VERSUS STATE OF ANDHRA PRADESH & ANR. - 2022 (12) TMI 822 - SUPREME COURT 

Provision considered

In the above judgment we find mainly section 14 of the Limitation Act based on which delay was held condonable and condoned by excluding period during which relief was sought through   proceedings by way of Writ Petition.

However for a thorough study of applicability of the Limitation Act , provisions which cast limitations and provisions under which some relaxations are provided and can be availed need to be studied in details.

Depending on facts , circumstances , nature, specific applicable law various provisions of the Limitation Act can be found.

 SECTION WISE THE LIMITATION ACT, 1963 IS FOUND ON THIS WEBSITE AT:

https://www.taxmanagementindia.com/visitor/acts_rules_provisions.asp?ID=341

Some of very important provisions of  THE LIMITATION ACT, 1963 found in

2. Definitions.-In this Act, unless the context otherwise requires,-

(j) “period of limitation” means the period of limitation prescribed for any suit, appeal or application by the Schedule, and “prescribed period” means the period of limitation computed in accordance with the provisions of this Act;

PART II LIMITATION OF SUITS, APPEALS AND APPLICATIONS

Consists the following provisions (heading only given)

3. Bar of limitation.

4. Expiry of prescribed period when court is closed.

 5. Extension of prescribed period in certain cases.

 6. Legal disability.

 7. Disability of one of several persons.

8. Special exceptions.

9. Continuous running of time.

10. Suits against trustees and their representatives.

11. Suits on contracts entered into outside the territories to which the Act extends

PART III  -  COMPUTATION OF PERIOD OF LIMITATION consists of the following sections ( heading only given)

12. Exclusion of time in legal proceedings.

13. Exclusion of time in cases where leave to sue or appeal as a pauper is applied for.

14. Exclusion of time of proceeding bona fide in court without jurisdiction.

15. Exclusion of time in certain other cases.

16. Effect of death on or before the accrual of the right to sue.

17. Effect of fraud or mistake.

 18. Effect of acknowledgment in writing.

19. Effect of payment on account of debt or of interest on legacy.

20. Effect of acknowledgment or payment by another person.

 21. Effect of substituting or adding new plaintiff or defendant.

22. Continuing breaches and torts.

 23. Suits for compensation for acts not actionable without special damage.

 24. Computation of time mentioned in instruments.

Applicability of above and other provisions need to be examined in view of facts, circumstances, and specific law under which flexible or rigid limitations may be found.

Case of M/S LAXMI SRINIVASA R AND P BOILED RICE MILL VERSUS STATE OF ANDHRA PRADESH & ANR. (supra.)

In this case it has been held that

a.  Exclusion of time is different, and cannot be equated with condonation of delay.

b. The period once excluded, cannot be counted for the purpose of computing the period for which delay can be condoned.

c.  for exclusion of time under Section 14 of the Limitation Act, 1963, the conditions stipulated in Section 14 have to be satisfied.

In this case petitioner has at first instance filed a Writ Petition (WP) challenging the order passed by original authority.

When WP was not allowed, the petitioner immediately filed appeal, claiming that time or period required in process of WP is to be excluded to compute period of limitation.

That is to say the period from the date of filing of the writ petition on 24.02.2018 and the date on which it was dismissed as not entertained viz. 07.03.2018, should have been excluded.

The appellate authority did not accept this contentions and appeal was dismissed as  time barred and beyond consolable period. The appellate authority did not allow exclusion of the period required in WP proceeding.

Immediately after the dismissal of the writ petition, the appellant did file an appeal before the Appellate Authority. On exclusion of the aforesaid period, the appeal preferred by the appellant would be within the condonable period.

The High Court also did not condone alleged delay in filing of appeal before appellate authority. Therefore, Special Leave to Appeal was filed before the Supreme Court.

Analysis from judgment of the Supreme Court :

1. Leave was  granted.

2. Regarding High Courts order is not sustainable, The Supreme Court un second para of judgment held that:

          “ The impugned order passed by the High Court affirming the order dated 27.04.2018 passed by Appellate Deputy Commissioner (CT) (FAC), Vijayawada, holding that the delay is beyond condonable period is unsustainable in law.”

We find reasoning, discussions and order  in third paragraph which is analyzed:

            3.  It is an accepted position that the appellant had filed a writ petition before the High Court on 24.02.2018, which was not entertained vide the order dated 07.03.2018 on the ground that the appellant should approach the Appellate Authority.

The appellant is entitled to ask for exclusion of the said period in terms of Section 14 of the Limitation Act, 1963. Exclusion of time is different, and cannot be equated with condonation of delay.

The period once excluded, cannot be counted for the purpose of computing the period for which delay can be condoned.

Of course for exclusion of time under Section 14 of the Limitation Act, 1963, the conditions stipulated in Section 14 have to be satisfied. [See CONSOLIDATED ENGG. ENTERPRISES VERSUS PRINCIPAL SECY. IRRIGATION DEPTT. & ORS. - 2008 (4) TMI 668 - SUPREME COURT and KALPRAJ DHARAMSHI & ANR. VERSUS KOTAK INVESTMENT ADVISORS LTD. & ANR. - 2021 (3) TMI 496 - SUPREME COURT]

4. In the facts of the present case, we find that the period from the date of filing of the writ petition on 24.02.2018 and the date on which it was dismissed as not entertained viz. 07.03.2018, should have been excluded. The writ proceedings were maintainable, but not entertained. Bona fides of the appellant in filing the writ petition are not challenged. Further, immediately after the dismissal of the writ petition, the appellant did file an appeal before the Appellate Authority. On exclusion of the aforesaid period, the appeal preferred by the appellant would be within the condonable period. Accordingly, we direct that the application for condonation of delay filed by the appellant would be treated as allowed. The delay is directed to be condoned.

5. Recording the aforesaid, the appeal is allowed with the direction that the Appellant Authority would examine the appeal on merits.

6.  We clarify that have not expressed any opinion on the merit of the case.

7.  Pending application(s), if any, shall stand disposed of.

Unquote:

We find that the provisions of  s. 14 of the Limitation Act are well known and well settled as we find that honorable Supreme Court has referred some of  earlier judgments on similar issue decided by the Supreme Court.

Therefore, it was not proper for the appellate authority to consider the appeal filed as beyond limitation and also beyond condonable period.

This is also a case of un-necessary litigation on settled legal position.

We find brain drain due to such cases causing wastage of time of honorable Judges – minimum two judges constitute a bench for such matter. In this case honorable   MR. SANJIV KHANNA AND MR. J.K. MAHESHWARI, JJ passed the final order. There are likely to be many orders on this issue.

For Petitioner(s) three senior counsels appeared  namely   – 1.  Mr. Vidya K. Sagar, Adv., 2. Mr. Ajit Kumar Jha, Adv.,  3.  Mr. K. S. Rana, AOR appeared.

For Respondent(s)  the  STATE OF ANDHRA PRADESH & ANR.–7 senior advocates appeared namely:

 1.  Mr. Mahfooz A. Nazki, AOR,

2. Mr. Polanki Gowtham, Adv.,

3. Mr. Shaik Mohamad Haneef, Adv.,

4. Mr. T. Vijaya Bhaskar Reddy, Adv.,

5. Mr. K.V.Girish Chowdary,

 6. Adv., Ms. Rajeswari Mukherjee, Adv.,

7. Ms. Niti Richhariya, Adv. Appeared.

For petitioner  this case  may be very important and involve high risks forwarding and contesting the same he has to engage senior advocates to face so many counsels of revenue / AP state.

All such litigations are causing lot of brain drain of highly qualified and competent persons acting as judges, counsels, administrative officers of tax authorities and taxpayers.

This must come to an end or minimized.

Why so many counsels are engaged by revenue / Central Government and Sate Governments on un-necessary litigation.  

 Article by the author on related subject is found at  https://www.taxmanagementindia.com/visitor/Article.asp?Expert_ID=5385

AVOID EXCESSIVE PUBLIC SPENDING ON UN NECESSARY LITIGATION AND ENGAGING EXCESSIVE NUMBER OF COUNSELS.