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KAJAL INDUSTRIES AND 1 Versus STATE OF GUJARAT

Condonation of delay - bona fide belief that since the second appeal in earlier point of time is very much pending which relates to the very same period and therefore, this subsequent first appeal against regular assessment order will be kept pending - Held that: - right from the beginning the innocence which has been tried to be projected appears to be not worthy to be accepted. We found that the conclusion arrived at by the Tribunal while exercising discretion is based upon the material on rec .....

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fide belief. - The decision in the case of Brijesh Kumar and ors vs. State of Haryana and ors [2015 (7) TMI 21 - SUPREME COURT] relied upon where it was held that this Court rejected the contention that a petition should be considered ignoring the delay and laches on the ground that he filed the petition just after coming to know of the relief granted by the Court in a similar case as the same cannot furnish a proper explanation for delay and laches. The Court observed that such a plea is w .....

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5 passed by the learned Tribunal whereby the appeal filed by the petitioner came to be dismissed on the ground of delay and laches. 2. Brief facts are as under: Petitioner No.1 is a registered dealer under the provisions of Gujarat Value Added Tax Act, 2003 ['the Act' for short]. Petitioner No.2 was initially operating a repairing shop of watches and mobiles in the name of Kajal Mobile Watch at Surat. During the passage of time, he came in contact with two persons named as Rakesh Patel a .....

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ning one bank account with ICICI Bank. All transactions were carried out by those two persons named as Nirav Patel and Rakesh Patel. It has been learnt that by forging signature of petitioner No.2 even two bank accounts were opened up in the State Bank of India and Dena Bank. 3. On 28.03.2008, the officers from VAT department visited the business and residential premises of the petitioner and since the petitioner had no knowledge, Mr. Nirav Patel remained present at the time of search proceeding .....

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this manner, the business was going on. It is the case of petitioner No.2 that suddenly he received a provisional assessment order passed by the authority on 21.12.2009 raising a demand of ₹ 71,74,205/- and at that point of time, petitioner No.2 realized that those two persons are using the name of petitioner No1 firm and also came to know about the fact that as per the department, no genuine sale or purchase business was going on but merely a billing activity was undertaken. On realizing .....

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ere was no money, the said first appeal came to be dismissed summarily vide order dated 09.03.2010 for want of payment of pre-deposit. 5. The petitioner against the said order of first appeal had filed second appeal before the learned VAT Tribunal. The Tribunal by treating the payment of ₹ 25,000/-, which was made at the time of seeking registration and later on amount of ₹ 3,82,085/- which was coercively recovered from the bank accounts, as the payment of deposit and the second appe .....

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or the purpose of filing first appeal against this order, one Mr. Bhaumik Desai, an advocate, came to be appointed who filed the first appeal on 12.01.2012 challenging the regular assessment order. 6. The petitioner in view of these circumstances remained under a bona fide belief that since the second appeal in earlier point of time is very much pending which relates to the very same period and therefore, this subsequent first appeal against regular assessment order will be kept pending and ther .....

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herefore, was waiting. However, in the meantime, on 01.06.2015 suddenly he was served with a notice of recovery from VAT Department. The petitioner informed the VAT department about the pendency and chronology of events which took place and requested to keep recovery in abeyance. 7. At that point of time, upon inquiry, the information was received by the petitioner No.2 that the subsequent first appeal, which was filed against regular assessment, was already disposed of in the year 2012. Accordi .....

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.2012, the delay has occasioned in preferring the second appeal and the delay is informed to have taken place of 1256 days in filing the second appeal. 8. The petitioner had tried to persuade the Tribunal for seeking condonation of delay by projecting his plight as stated here-inabove and requested that there was no mala fide intent in not approaching within time and there was no fault on part of the petitioner. It is on account of non-availability of information as well as the order of first ap .....

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tition appears to have been filed on 21.07.2016. 9. Learned advocate Mr. Uchit Sheth on behalf of the petitioner has submitted that the petitioner has received the knowledge of dismissal of first appeal against the regular assessment order only when his client has received the recovery proceedings in the form of notice of demand and no copy of the order of first appeal has ever been received by the petitioner. It was also submitted by the counsel that petitioner has requested the learned Tribuna .....

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condone the delay. It was also contended by the learned advocate Mr. Sheth that the order of first appeal had not been served nor was informed by his consultant at any point of time and there was no deliberate or mala fide intent in causing the delay and there was no negligence on part of the petitioner. It was also submitted that as soon as he received a certified copy of the order of first appeal the second appeal came to be filed within a period as required under section 73 of the Act. It wa .....

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ore requested the court to set aside the impugned order and the appeal may be directed to be heard on merit. 10.To oppose the stand of the petitioner, the learned AGP Mr. Pranav Trivedi has contended that the petitioner, under the guise of so called bona fide belief and impression, has dragged on the liability for long period on the one pretext or the other. Therefore, the delay which has occasioned is deliberate delay as found from the record. It was also contended that the petitioner was well .....

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as aware about the fact that during the pendency of second appeal, final assessment order has already been passed, the same was not disclosed before the Tribunal and therefore, this very conduct smacks mala fides. The innocence which is tried to be projected is not appearing to be genuine. The learned AGP has contended that enormous delay has not been cogently explained. It has also been pointed out before the Court that even after disposal of second appeal by the Tribunal on 05.11.2015, after a .....

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devoid of merit, the learned AGP contended to dismiss the same. Learned AGP further submitted that the recovery notice came to be given on 01.06.2015 and only thereafter, after a period of more than two months, the petitioner has sought certified copy. About the unawareness which has been tried to be projected is found by the Tribunal incorrect. Therefore, since the very basis of main reason which has been projected is illusory. The learned Tribunal has rightly passed an order and therefore, no .....

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challenging final assessment order. The learned Tribunal specifically found that this ground is not correctly projected. It is reflected from the covering letter dated 14.08.2015 which indicates that the order was very much served upon the petitioner. (ii) It was also specifically found by the Tribunal that there is no explanation offered of delay for the period commencing from 29.03.2012 to 14.10.2015 and therefore, the plea of order being not served is not accepted by the Tribunal. This catego .....

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Tribunal was led to believe on misrepresentation and concealment by the petitioner. Thereby an order of remand was persuaded to be passed by the Tribunal and this conduct on the part of the petitioner was seriously taken up by the Tribunal and rightly so and therefore, specific finding has been arrived at. It was also noticed by the Tribunal that there is a long delay of 1256 days which is not cogently explained and therefore, the Tribunal refrained from going into the merit as also the pre-depo .....

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has been tried to be projected appears to be not worthy to be accepted. We found that the conclusion arrived at by the Tribunal while exercising discretion is based upon the material on record and upon examination of it. Therefore, we see no reason to dislodge the said finding more particularly, when the petitioner has invoked extraordinary equitable jurisdiction. The very plea of not aware about the passing of an order by the first appellate authority is not cogently explained except by a mere .....

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ported in AIR 2014 SC 1612 wherein the Apex Court while dealing with the plea of seeking condonation of delay has observed like this: 11. The courts should not adopt an injustice-oriented approach in rejecting the application for condonation of delay. However the court while allowing such application has to draw a distinction between delay and inordinate delay for want of bona fides of an inaction or negligence would deprive a party of the protection of Section 5 of the Limitation Act, 1963. Suf .....

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r persons cannot take benefit thereof approaching the court at a belated stage for the reason that they cannot be permitted to take the impetus of the order passed at the behest of some diligent person. 15. Yet in another decision in case of Union of India and ors vs. Hanuman Industries and anr reported in 2015 AIAR (Civil) 730 in para 16 and 18 while dealing with the request for condonation of delay what yardstick is to be observed is reproduced hereinafter. 16. The gravamen of the authorities .....

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ed themselves to the benefit of the adjudication in the earlier lis. In the accompanying facts and circumstances in our comprehension, it would be iniquitous and repugnant as well to the public exchequer to entertain the belated claim of the respondents on the basis of the doctrine of promissory estoppel which is even otherwise inapplicable to the case in hand. 16. In case of State of Karnataka and ors vs. S.M.Kotrayya and ors reported in 1996 (6) SCC 267 the Supreme Court held and observed as u .....

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