20-Day Delay in Review Order Cannot be Excused Without Board Extension or Condonation: CESTAT Dismisses Dept’s Appeal against Nippon [Read Order]

The Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) dismissed the department’s appeal, holding that the delay in issuing the review order by 20 days could not be excused in the absence of a condonation request or an extension granted by the Board under Section 129D(3) of the Customs Act, 1962.

Nippon Thermostat Co. Pvt. Ltd, the assessee, imported materials from its related company, Nippon Thermostat Company Japan. The Order-in-Original accepted the declared transaction value for a period, but the Reviewing Authority directed the department to appeal to the Commissioner (Appeals) of this order for a proper examination.

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The department reviewed the Order-in-Original dated 16.09.2014, but the Review Order was issued on 20.01.2015, 20 days beyond the 90-day limit under Section 129D(3) of the Customs Act, 1962, due to a clerical error in calculating the deadline.

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The Commissioner (Appeals), citing the statutory delay, rejected the department's appeal. The department, aggrieved by the order, filed an appeal before the CESTAT, challenging the dismissal.

The counsel for the respondent, N. Viswanathan, supported the adjudicating authority’s decision to reject the appeal as time-barred. He submitted that the appellant failed to comply with the statutory timeline for passing the review order.

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The counsel further pointed out that the appellant had not applied for condonation of delay. The counsel added that the Board did not approve extending the time limit for the review order as mandated under Section 129D(3) of the Act.

Meanwhile, Anandalakshmi Ganeshram, the counsel for the department, opposed the rejection of the appeal made by the Commissioner (Appeals).

Placing reliance on CCE v. KAP CONES [2017], the counsel argued that the appeal was filed within the time prescribed under Section 129D(4) of the Customs Act, 1962.

The counsel contended that the three-month period under Section 129D(3) of the Act is merely procedural, concerning internal review, whereas the substantive requirement is to file the appeal within one month from the date of the review order.

She highlighted that the dismissal as time-barred was not legitimate because the appeal was filed within the overall four-month period.

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After hearing both sides, the bench comprising Ajayan T.V. (Judicial Member) and Vasa Seshagiri Rao (Technical Member) evaluated the submissions made by the parties.

The Tribunal considered the department's reliance on the Supreme Court's decision in CCE v. KAP Cones (2017). The Apex Court, interpreting a similar Section 35E(3) of the Central Excise Act, 1944, held that the Board can extend the review order timeline by 30 days with sufficient cause, negating the need for delay condonation if such an extension is granted.

However, the Tribunal noted that in the present case, no evidence was produced to show that the appellant had submitted any application to the Board seeking an extension of time, nor was any such extension order issued by the Board. The tribunal also observed that the appellant did not file any condonation application for the delay.

Since the department failed to justify the delay and failed to obtain a board extension for the late review order, the tribunal upheld the dismissal made by the Commissioner (Appeals).

To Read the full text of the Order CLICK HERE

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