The Bombay High Court quashed the order imposing service tax along with levy of interest and penalty against Skoda Auto Volkswagen India.
The Petitioner, Skoda Auto Volkswagen India is a private limited company engaged in the business of import, manufacturing, assembling, and sale of motor vehicles and motor parts. It may be mentioned that the petitioner is the successor company formed pursuant to the scheme of amalgamation between Skoda Auto India Private Limited, Volkswagen Group Sales India Private Limited, and Volkswagen India Private Limited which was sanctioned by the National Company Law Tribunal, Mumbai Bench.
The Assistant Commissioner of Goods and Services Tax, Aurangabad Urban Division issued notice to the petitioner to show cause-cum-demand alleging that there was the short payment of service tax by the petitioner by not including the amount of TDS and the amount of R&D cess in payment of royalty which amount was quantified at Rs.15,03,571.00 for the period from April 2016 to March 2017. Petitioner was also called upon to show cause as to why interest and penalty should not be levied.
According to the petitioner, after receipt of the order-in-original, a copy of the same was handed over to the Assistant Manager (Taxation), who was responsible for handling the matter. The Assistant Manager (Taxation) who was in-charge of preparation and following up of appeal against the order-in-original ceased to be in the employment of the petitioner. In the course of handing over charge of the office, there was a lapse in communication as to the last date for filing of appeal before respondent authority.
By the impugned order respondent authority held that the petitioner had received the order-in-original. Petitioner had the normal period of limitation for filing the appeal upto October 30, 2019. This period could be extended by another month if delay could be satisfactorily explained. Adding this one month, the limitation period would stand extended to November 30, 2019.
However, the present appeal was filed on December 4, 2019 i.e., the date of receipt of the appeal, which was beyond the extended period of limitation. Holding that respondent authority had no power to condone the delay beyond the period of one month after the normal period of limitation of two months, the appeal was found to be time-barred. Consequently, the application for condonation of delay was rejected. Resultantly, the appeal was dismissed as time barred without entering into the merit.
The division bench of Justice Abhay Ahuja and Justice Ujjal Bhuyan held that dispatch of the appeal by the petitioner was within the extended period of limitation of one month and, therefore, without considering the prayer for condonation of delay of the petitioner, respondent authority ought not to have rejected the appeal as being time-barred by taking the ground that he had no jurisdiction to condone the delay beyond the extended limitation period of one month.
Therefore, the court set aside the order passed by respondent authority and remand the matter back to respondent authority to consider afresh the application of the petitioner for condonation of delay in filing the related appeal.
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