Supreme Court clarifies the applicability of Section 5 of the Limitation Act to revisions under the Himachal Pradesh Value Added Tax Act, 2005

Introduction

Date of the Judgment: 25 October 2019

Citation: (2019) INSC 123

Judges: Arun Mishra, J., M.R. Shah, J., and B.R. Gavai, J.

Can a delay in filing a revision petition before the High Court under the Himachal Pradesh Value Added Tax Act, 2005, be excused? This was the core question before the Supreme Court. The court examined whether Section 5 of the Limitation Act, 1963, which allows for the condonation of delay, applies to revisions filed under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005. The Supreme Court bench, comprising Justices Arun Mishra, M.R. Shah, and B.R. Gavai, delivered the judgment.

Case Background

The case involves appeals against a judgment by the High Court of Himachal Pradesh, which had refused to condone the delay in filing a revision petition. The revision petition was filed under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, challenging an order by the Himachal Pradesh Tax Tribunal. The High Court, relying on a previous decision, held that Section 5 of the Limitation Act does not apply to revisions under Section 48 of the Act of 2005, meaning the court could not excuse any delay beyond the 90-day limit specified in the Act.

Timeline:

Legal Framework

The core of the dispute revolves around the interpretation of Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, and its interaction with the Limitation Act, 1963.

Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, states:

“48. Revision to High Court. – (1) Any person aggrieved by an order made by the tribunal under sub-section (2) of section 45 or under sub-section (3) of section 46, may, within 90 days of the communication of such order, apply to the High Court of Himachal Pradesh for revision of such order if it involves any question of law arising out of erroneous decision of law or failure to decide a question of law.”

This section allows an aggrieved party to file a revision petition with the High Court within 90 days of receiving the order from the Tax Tribunal.

Section 29(2) of the Limitation Act, 1963, which is crucial for this case, states:

“29. Savings.—(2) Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in sections 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law.”

This section essentially says that if a special law (like the VAT Act) sets a different limitation period than the Limitation Act, the rules of the Limitation Act (Sections 4 to 24), including Section 5 (which allows for condonation of delay), will apply unless the special law specifically excludes them.

Arguments

The appellants argued that the High Court erred in not applying Section 5 of the Limitation Act, 1963, to the revision petition filed under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005. They contended that the 90-day limit in Section 48 is not an absolute bar and that the High Court has the power to condone delays if sufficient cause is shown. They relied on several Supreme Court precedents to support their claim that unless a special law expressly excludes the provisions of the Limitation Act, they would apply.

The respondents, on the other hand, supported the High Court’s decision, arguing that the language of Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, impliedly excludes the application of Section 5 of the Limitation Act. They cited the decision of the Coordinate Bench in State of Himachal Pradesh & others v. Tritronics India Private Limited, and the Supreme Court’s ruling in Patel Brothers v. State of Assam & Ors., which held that the provisions of Section 5 of the Limitation Act, stand excluded by necessary implication by the language employed in Section 84 of the Assam Value Added Tax Act, 2003. They also referred to Commissioner of Customs and Central Excise v. Hongo India Private Limited, where it was held that the High Court cannot condone delays after the expiry of the prescribed period.

Issues Framed by the Supreme Court

The Supreme Court framed the following issue:

1. Whether the High Court, while exercising revisional power under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, can condone the delay if a revision under Section 48 of the Act of 2005 is filed beyond 90 days from the date of communication of the order, or whether it excludes the applicability of Section 29 of the Limitation Act, 1963, and consequently, Section 5 of the Limitation Act?

Treatment of the Issue by the Court

The following table demonstrates how the Court decided the issue:

Authorities

The Supreme Court considered the following authorities:

Judgment

The Supreme Court, after considering the submissions and authorities, held that the High Court erred in not applying Section 5 of the Limitation Act to the revision petition filed under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005.

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The Court relied on Hukumdev Narain Yadav v. Lalit Narain Mishra, (1974) 2 SCC 133*, to emphasize that the scheme of a special law should be examined to determine if the provisions of the Limitation Act are excluded.
• The Court cited Sakuru v. Tanaji, AIR 1985 SC 1279*, to reiterate that the Limitation Act applies to courts and not quasi-judicial bodies unless specifically made applicable.
• The Court referred to Lata Kamat v. Vilas, (1989) 2 SCC 613*, to illustrate that the Limitation Act applies when a special law does not exclude it.
• The Court used State of W.B. & Ors. v. Kartick Chandra Das & Ors, (1996) 5 SCC 342*, to support the view that Section 5 of the Limitation Act applies when not expressly excluded.
• The Court cited Mukri Gopalan v. Cheppilat Puthanpurayil Aboobacker, (1995) 5 SCC 5*, to show that appellate authorities can condone delays when the special law does not exclude it.
• The Court relied on Mangu Ram v. Municipal Corporation of Delhi, (1976) 1 SCC 392*, to emphasize that a peremptory language is not sufficient to exclude Section 5.
• The Court distinguished Union of India v. Popular Construction Co., (2001) 8 SCC 470*, by noting that the phrase “but not thereafter” in the Arbitration Act amounts to express exclusion, which is not present in the Himachal Pradesh VAT Act.
• The Court distinguished Consolidated Engineering Enterprises v. Principal Secretary, Irrigation Department & Ors., 2008 (7) SCC 169* by stating that Section 14 of the Limitation Act is not excluded, but Section 5 is excluded in the case of the Arbitration and Conciliation Act.
• The Court distinguished Commissioner of Customs & Central Excise v. Hongo India Pvt. Ltd. & Anr., (2009) 5 SCC 791*, stating that the scheme of the Excise Act is materially different.
• The Court relied on State of Madhya Pradesh & Anr. v. Anshuman Shukla, (2014) 10 SCC 814*, to support the view that Section 5 applies when not expressly excluded.
• The Court distinguished Patel Brothers v. State of Assam & Ors., 2017 (2) SCC 350*, by highlighting the specific provision in the Assam VAT Act that excludes other provisions of the Limitation Act.
• The Court cited M. P. Steel Corporation v. Commissioner of Central Excise, (2015) 7 SCC 58*, to show the connotations of “court” and “civil proceedings” under Section 14 of the Limitation Act.
• The Court distinguished Commissioner of Customs, Central Excise, Noida v. Punjab Fibres Ltd., Noida, (2008) 3 SCC 73*, by stating that Section 5 of the Limitation Act is not applicable in that case.
• The Court distinguished Chaudharana Steels Private Ltd. v. Commissioner of Central Excise, Allahabad, (2009) 15 SCC 183*, by stating that the High Court has no power to condone the delay in that case.

What weighed in the mind of the Court?

The Supreme Court’s decision was significantly influenced by the principle that unless a special law expressly excludes the provisions of the Limitation Act, they are applicable. The Court emphasized that the Himachal Pradesh Value Added Tax Act, 2005, does not contain any provision that expressly or impliedly excludes the application of Section 5 of the Limitation Act. The Court also noted that the scheme of the Act allows for condonation of delay in certain situations. This indicated that the legislative intent was not to completely bar the application of the Limitation Act.

Fact:Law Ratio

The Court’s reasoning was primarily legal, focusing on the interpretation of statutes and precedents. The factual aspects of the case were considered to a lesser extent, as the main issue was a legal one.

Logical Reasoning:

The Court considered whether the Himachal Pradesh VAT Act expressly or impliedly excluded the application of Section 5 of the Limitation Act. Finding no such exclusion, the Court concluded that Section 5 applies.

The Court rejected the argument that the 90-day limit in Section 48 was absolute, emphasizing that the Limitation Act provides for condonation of delay unless expressly excluded. The Court distinguished the cases cited by the respondents, highlighting that those cases turned on specific provisions in the respective special laws, which are absent in the Himachal Pradesh VAT Act.

The Supreme Court concluded that the provisions of Section 5 of the Limitation Act are applicable to the revisional provision under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005. The Court set aside the High Court’s judgment and remitted the cases back to the High Court for examination on merits.

The Court held that the High Court was incorrect in holding that Section 5 of the Limitation Act does not apply to revision petitions filed under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005. The Court emphasized that unless a special law expressly excludes the provisions of the Limitation Act, they would apply. The Court also noted that the scheme of the Himachal Pradesh Value Added Tax Act, 2005, does not indicate an intention to exclude the Limitation Act.

The Supreme Court emphasized that the language of Section 48 of the Act of 2005 does not expressly exclude the application of the provisions of the Limitation Act. The Court also noted that the scheme of the Act does not imply such exclusion. The Court explicitly stated that the provisions of Section 5 of the Limitation Act are applicable to the revisional provision under Section 48 of the Act of 2005.

The Court observed, “In section 48, there is no express exclusion. Because of the scheme of the Act, it cannot be inferred that by implication, the provisions of section 5 of the Limitation Act are excluded.”

The Court also stated, “We hold that by virtue of the provisions contained in section 29(2), provisions of section 5 of the Limitation Act would apply to proceedings under Section 48 of the Act of 2005.”

The Court further noted, “Thus, the intendment is not to exclude the Limitation Act. We condone the delay in filing of revision.”

Key Takeaways

• The High Court can now condone delays in filing revision petitions under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, if sufficient cause is shown.
• The judgment clarifies that unless a special law expressly excludes the application of the Limitation Act, its provisions, including Section 5, apply.
• Taxpayers in Himachal Pradesh will now have the benefit of Section 5 of the Limitation Act, allowing for condonation of delay in filing revisions under the Himachal Pradesh Value Added Tax Act, 2005.
• This decision provides clarity on the interplay between special laws and the Limitation Act, ensuring that the benefits of the Limitation Act are not easily ousted.

Directions

The Supreme Court set aside the impugned judgments and orders of the High Court and remitted the cases back to the High Court to examine the same on merits in accordance with the law.

Development of Law

The ratio decidendi of this case is that Section 5 of the Limitation Act, 1963, applies to revision petitions filed under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005, as there is no express exclusion of the Limitation Act in the special law. This decision reinforces the principle that the provisions of the Limitation Act apply unless expressly excluded by a special or local law, thus ensuring that the benefits of the Limitation Act are not easily ousted.

Conclusion

In conclusion, the Supreme Court’s judgment clarifies that the High Court can condone delays in filing revision petitions under Section 48 of the Himachal Pradesh Value Added Tax Act, 2005. This decision ensures that taxpayers are not unduly penalized for delays, provided they can show sufficient cause. The judgment reinforces the principle that the Limitation Act applies unless expressly excluded by a special law.