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Section 5 Of Limitation Act Applicable To Proceedings Under Railway Claim Tribunal Act, 1987: Allahabad High Court

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CASE TITLE: M/S Krishak Bharti Co-Operative Ltd.Kribhco Surat Gujarat v. Union Of India Thru G.M. Northern Eastern Railway Gorakhpur [FAFO No. – 236 of 2002]

DECIDED ON: 16.08.2023

CORAM: Hon’ble Ajay Bhanot,J

INTRODUCTION

The application of Section 5 of the Limitation Act, 1963 has been affirmed by the Allahabad High Court in relation to proceedings governed by the Railway Claim Tribunal Act, 1987 and the Railway Claim Tribunal (Procedure) Rules, 1989.

Justice Ajay Bhanot, presiding over the bench, was overseeing an appeal stemming from a claim application submitted before the Railway Claim Tribunal. The application was dismissed due to non-prosecution. Following this, the claimant submitted a request for the restoration of the claim application. However, this request was rejected due to being beyond the permissible time limit.

FACTS

The appellant submitted a compensation claim to the Railway Claims Tribunal’s Lucknow Bench (“Railway Tribunal”) following the demise of his son. However, due to a lack of prosecution, the claim was dismissed on 09.02.2000. Subsequently, eight months later, on 04.10.2000, the appellant lodged an application for restoration. Rule 18 of the Railway Claims Tribunal (Procedure) Rules, 1989 specifies a 30-day timeframe for submitting an application to reverse a default dismissal order. The Railway Tribunal declined the restoration application due to it being beyond the allowable time limit.

In response to the decisions made by the Railway Tribunal, the appellant initiated an appeal in the High Court.

CASE ANALYSIS AND DECISION

The court drew upon precedents from the Gujarat High Court, specifically the cases of Shyam Santaram Sali (Marathi) v. Union of India and Dharmesh Madhubhai Parmar v. Union of India. In these cases, it was established that Section 5 of the Limitation Act is applicable to proceedings governed by the Railway Claim Tribunal Act, 1987, in conjunction with the Railway Claim Tribunal (Procedure) Rules, 1989.

The court acknowledged that the case had been transferred from Gorakhpur to Lucknow, and due to an administrative oversight, this transfer was not communicated to the appellant. Consequently, his absence on the day of the case’s dismissal was beyond his control.

The court noted that the application for condonation of delay demonstrated a valid and sincere reason for the delay, with no intention to cause it. The court further recognized the appellant’s consistent diligence in pursuing his claim. The court emphasized that when substantive rights are at stake, the primary focus should be on ensuring justice rather than barring claimants on technical grounds.

The court held that given the presence of a valid reason for the delay, the Railway Tribunal should have granted condonation for the delay.

As a result, the court nullified the decision to reject the application for delay condonation and reinstated the case for a comprehensive review on its merits.

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E-Way Bill Expired Due To Vehicle Break Down: Allahabad High Court Quashes Seizure Memo

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CASE TITLE: M/S Rateria Laminators Pvt. Ltd. vs. Additional Commissioner Grade 2 And Another [WRIT TAX No. – 599 of 2023]

DECIDED ON: 16.08.2023

CORAM: Hon’ble Piyush Agrawal,J

INTRODUCTION
The decision by the Allahabad High Court involved overturning a ruling based on Section 129(3) of the UPGST Act 2017. This ruling had imposed a penalty based solely on the absence of evidence regarding the driver’s illness and the vehicle breakdown.

The petitioner regularly received goods from GAIL in Auraiya, Uttar Pradesh. Specifically, two invoices dated 6.3.2023 were issued for these inward supplies. E-way bills were generated, valid until 12.3.2023, and a Goods Receipt (GR) was also created on the same day. The GR explicitly referenced the invoice numbers and E-way bill details.

FACTS

While en route, the vehicle operator fell ill and could not complete the delivery within the timeframe specified in the E-way Bill. Consequently, on 13.3.2023, the vehicle was intercepted, and Form GST MOV04 was generated on 14.3.2023. Following this, Form GST MOV01 was produced on 23.3.2023, leading to an immediate decision that the transported goods were lacking proper documentation due to the expiration of the E-way bills.

A notification via Form GST MOV 07, pursuant to section 129(3) of the UPGST Act, was served, suggesting the imposition of penalties under sections 129(1)(a) and 129(1)(b) of the Act. Subsequently, an order was enacted under section 129(3) of the Act, requiring the petitioner to submit a specified amount to facilitate the release of the goods. Despite the petitioner’s appeal against this, it was dismissed.

The petitioner argued that there were no discrepancies between the physical inspection of the goods and the accompanying documentation. They contended that the driver’s unfamiliarity with GST laws prevented them from seeking an extension of the E-way Bill. The petitioner maintained that the situation was beyond their control.

Furthermore, the petitioner asserted that in their response, they explicitly stated that the goods could not be delivered on time due to the unforeseen illness of the driver. However, the Authority swiftly dismissed this explanation.

Drawing from the precedent set by the Allahabad High Court in Bharti Airtel Ltd. vs. State of U.P., the petitioner contended that after refusing to remit taxes under Section 129(3), the Authority should have initiated proceedings under Sections 73, 74, and 75, in conjunction with Section 122 of the Act.

The Department’s representative alleged that the petitioner’s failure to renew the E-way bill indicated a breach of legal provisions. They also claimed that the expired E-way bill suggested the petitioner’s intent to evade tax obligations. Additionally, no medical records substantiating the driver’s illness were provided as evidence.

CASE ANALYSIS AND DECISION

The court observed that there were no inconsistencies concerning the quality and quantity of goods during their transportation. The decision was made based solely on the expiration of the E-way Bill. Furthermore, the court explicitly highlighted that there were no allegations of tax evasion in any of the orders issued against the petitioner.

The court distinguished the judgment made by the Supreme Court in the case of Assistant Commissioner (ST) v. Satyam Shivam Papers Pvt. Ltd. This distinction was drawn on the grounds that the aforementioned case involved a roadblock due to anti-CAA protests, whereas in the current scenario, the delay was attributed to the driver’s illness and vehicle breakdown. However, no substantiating evidence regarding these factors causing the delay had been presented on record.

While acknowledging that the petitioner had not provided any evidence to support the driver’s illness, the court noted that the Authority’s order had not provided any rationale for discrediting this claim.

Consequently, the writ petition was granted, leading to the matter being referred back to the Authority for a fresh assessment.

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Direct Tax Vivad Se Vishwas Act| Delay Can Be Condoned In Unforeseen Circumstances: Allahabad High Court

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CASE TITLE: Digvendra Pratap Singh vs. Union Of India And 2 Others [Writ Tax No. – 1510 of 2022]

DECIDED ON: 11.08.2023

CORAM: Hon’ble Siddhartha Varma,J. Hon’ble Arun Kumar Singh Deshwal,J.

INTRODUCTION

Last Friday, the Allahabad High Court granted permission to the petitioner to avail benefits under the Direct Tax Vivad Se Vishwas Act, 2020, even though their application under the Act was submitted three days after the stipulated period. The Court clarified that granting a condonation of delay in exceptional situations does not automatically extend the scope of the scheme.

The Parliament introduced the Direct Tax Vivad Se Vishwas Act, 2020 (referred to as the 2020 Act) with the aim of resolving disputes related to taxes, providing taxpayers relief from interest and penalties on outstanding taxes. As per the provisions of the 2020 Act, individuals wishing to settle contested tax amounts are required to submit a declaration under section 4 of the Act to the designated authority. Upon receipt of this declaration, the Authority is responsible for issuing a certificate to the declarant containing details of the tax arrears and the payable amount. Subsequently, the payment must be made by the deadline determined by the Ministry of Finance.

FACTS

For the Assessment Year 2010-11, the petitioner fulfilled the requirement by submitting their declaration on 5.6.2020 as mandated under Section 4 of the 2020 Act. The declaration certificate issued by the designated authority in Form-III, as outlined in Section 5 of the Act, was also uploaded on the portal by 9.11.2020. The petitioner was obligated to make a payment of Rs. 18,67,137/- on or before 31.12.2020.

The Ministry of Finance extended the deadline for payment under the scheme through various notifications. On the final deadline, which coincided with a Sunday, the petitioner delivered a check. However, due to the day being a Sunday, the payment receipt was issued on 3.11.2021. Subsequently, the petitioner was disqualified from availing benefits under the 2020 Act due to the three-day delay.

The Chairman of the Central Board of Direct Taxes declined the petitioner’s request for condonation of the delay, citing the notification that established the last deposit date as 31.10.2021, with no room for further extension.

The petitioner’s representative argued that unforeseen and external circumstances, along with legal hindrances, should be considered when granting an extension for depositing the remaining amounts. Reference was made to the case of Shekhar Resorts Ltd. vs. Union of India and others, where the Supreme Court held that condoning a delay in the presence of a legal obstacle does not constitute an extension of the scheme but rather a remedial measure.

The respondent’s counsel, however, relied on the case of M/s Ken Computek Pvt. Ltd. vs. Designated Committee (SVLDRS) and others, wherein the Supreme Court observed that the prescribed deadline for depositing the balance of tax under the 2020 Act scheme cannot be prolonged.Top of Form

 

CASE ANALYSIS AND DECISION

The bench, consisting of Justices Siddhartha Verma and Arun Kumar Singh Deshwal, noted that in a similar factual scenario, the Supreme Court in the case of Shekhar Resorts Ltd. vs. Union of India and others, as well as the Delhi High Court in I.A. Housing Solution Pvt. Ltd. vs. Principal Commissioner of Income Tax-4, had granted the petitioner the benefit of the scheme. Consequently, the petitioner was entitled to the benefit, as they had demonstrated good faith by submitting the check on the final day. The incident that caused the delay was an unforeseen event beyond the petitioner’s control.

In regard to the decision referenced by the Respondent, the Court held:

“While in the judgment of M/s Ken Computek Pvt. Ltd. vs. Designated Committee (SVLDRS) and others, delivered in SLP (C) No. 2116 of 2023, the Supreme Court did not address the issue of condoning delay in exceptional circumstances, it only observed that the benefits of the scheme cannot be extended beyond the timeline prescribed by the scheme.”

In line with this, the writ petition was granted and accepted.

approving bail, leading to the dismissal of the defendant’s bail plea.

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Allahabad HC Denies Bail To 19 Y/O ‘Lashkar-e-Taiba Associate’ Accused Of Promoting Arms Acquisition Through WhatsApp

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CASE TITLE: Inamul Haq Alias Inamul Imtiyaz vs. State of U.P [CRIMINAL MISC. BAIL APPLICATION No. – 7241 of 2023]

DECIDED ON: 09.08.2023

CORAM: Hon’ble Pankaj Bhatia,J.

INTRODUCTION

Last week, the Allahabad High Court declined to grant bail to a 19-year-old individual who was reportedly linked to the ‘Lashkar-e-Taiba’ group. The person had been apprehended by the Anti-Terrorist Squad (ATS) of the Uttar Pradesh Police the previous year on charges of disseminating animosity, advocating sentiments against India, and assisting in the procurement of weapons through WhatsApp groups.

In light of the accusations directed at the individual named Inamul Haq, also known as Inamul Imtiyaz, Justice Pankaj Bhatia’s panel noted that even though the freedom to practice and promote religion is safeguarded by Article 19, the nature of the allegations outlined in the First Information Report (FIR) indicates that the accused cannot be considered exempt from the provisions of the second part of Section 121-A IPC.

FACTS

Reportedly, the First Information Report (FIR) was filed against the accused under Sections 121-A and 153-A of the Indian Penal Code (IPC) and Section 66 of the Information Technology (IT) Act. The accusations revolved around his alleged creation of a WhatsApp group where he shared literature with potential jihadi connotations and uploaded videos of a similar nature.

The FIR also detailed that the individual in question confessed to aspiring to become a jihadi and acknowledged his affiliation with the Lashkar group. According to the FIR, he claimed to have maintained a WhatsApp group for approximately 15-16 years, comprising 181 members, including 170 from Pakistan, 3 from Afghanistan, and 1 each from Malaysia, Bangladesh, and India. Furthermore, he was accused of actively promoting arms acquisition and propagating the group’s ideology based on religious biases.

In his bid for bail, the accused approached the High Court, with his representative (Advocate Shivam Yadav) contending that the allegations in the FIR did not prima facie establish his involvement under Section 121-A IPC. It was argued that he had been in custody since March 14, 2022, and the offenses attributed to him were punishable by a maximum of five years’ imprisonment. Conversely, the state’s legal representative opposed his bail application, citing the allegations detailed in the FIR.

Against this context, the Court initially examined Section 121A IPC (Conspiracy to commit offenses punishable by section 121). The Court additionally observed that the accusations against the accused and the contents of the FIR indicated that he managed two WhatsApp groups primarily composed of foreign nationals. These groups were allegedly involved in promoting arms procurement and advancing the group’s agenda based on religious biases.

CASE ANALYSIS AND DECISION

Given these charges leveled against the defendant, the Court determined that the accused cannot be deemed to have violated the second portion of Section 121-A IPC. As a result, due to the seriousness of the accusation, the Court concluded that there was no basis for approving bail, leading to the dismissal of the defendant’s bail plea.

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In A Rare Tiebreaker, Allahabad High Court Grants Interim Protection To Indiabulls Officers In FIRs By Shipra Group

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CASE TITLE: Reena Bagga and Another vs. State of UP and 2 Others [Criminal MISC. Writ Petition No. – 11837/2023] and Himri Estate Pvt. Ltd. and 4 Others v. State of UP and 2 Others [Criminal MISC. Writ Petition No. – 11838/2023]

DECIDED ON: 08.08.2023

CORAM: Hon’ble Samit Gopal, J.

INTRODUCTION

Resolving divergent opinions concerning the suspension of the First Information Report (FIR) lodged by the Director of Shipra Estate against officials of Indiabulls Housing Finance Ltd. concerning disagreements related to a loan facility they had utilized, the Allahabad High Court has determined that without affording time for the Advocate General and the complainant’s legal representative to seek guidance, it is an appropriate situation to offer provisional safeguard.

Justice Samit Gopal, who was assigned the case as the third judge following a division in the bench of Justices Vivek Kumar Birla and Rajendra Kumar-IV, has ruled in favor of the officers of IHFL.

FACTS

The officers of IHFL expressed their discontent with the proliferation of legal actions stemming from a solitary loan transaction. Justice Kumar declined to grant immediate relief, citing the hasty progression of the matter and the lack of time afforded to the Additional Government Advocate (AGA) to gather guidance. He opined that the appropriate course was to allow the AGA the necessary time for instruction before delivering a consequential verdict that might adversely impact the opposing party.

On the contrary, Justice Birla supported the interim protection for the petitioners, drawing on the precedent set by Gagan Banga vs. Samit Mandal & another (2023). In this case, similar FIRs were under consideration, and the Supreme Court had granted protection to the financial institution and its officers.

The case was elevated to the Chief Justice’s attention, who subsequently delegated it to a third judge to solicit an opinion.

Currently, Justice Gopal has aligned with Justice Birla’s perspective, expressing:

“After reviewing the Supreme Court’s ruling in the matter of Gagan Banga vs. Samit Mandal & another: Contempt Petition (Civil) No. 774 of 2023 in Criminal Appeal No. 463 of 2022, along with the decision rendered by a Division Bench of this Court in Criminal Misc. Writ Petition No. 10893 of 2023 (Neeraj Tyagi and another vs. State of U.P. and 3 others), and considering the nature of the incident pertaining to financial institutions or money lenders pursuing recovery actions for their legitimate debts, with the proceedings adhering to the same trajectory, it is a suitable scenario to extend interim protection to the petitioners.”

In light of Shipra Group’s failure to fulfill its loan obligation to IHFL, Shipra Mall, an asset of the Shipra Group, was auctioned by IHFL. Himri Estate emerged as the successful bidder and acquired the mall.

Representative Mohit Singh of Shipra Group lodged several FIRs against IHFL officers and Himri Estate Pvt. Ltd. He alleged that the sale of Shipra Mall was illicit due to its undervaluation, resulting in substantial state revenue loss. Moreover, he claimed that specific officers were illicitly obtaining land in the vicinity, labeling them as land mafia from Delhi and NCR.

Conversely, the Additional Advocate General, representing the State, contended that given the potential sentences being less than 7 years, the petitioners needn’t fear arrest, thus negating the necessity for interim protection at this stage.

Additionally, the Informant’s legal counsel argued that the allegations against the petitioners extended beyond Shipra Mall to encompass illegally occupied lands held by the petitioners.

CASE ANALYSIS AND DECISION

The Court noted that the matter pertained to financial dealings involving loans, their non-repayment, and the subsequent auction of assets owned by the borrower.

In response to the argument put forth by the learned Additional Advocate General that the petitioners are unlikely to be arrested and any proceedings would adhere to the directives of the Supreme Court as referenced by him, the Court clarified that the interim order’s scope extends beyond solely preventing the arrest of the petitioners; it encompasses other aspects as well, as per the Court’s determination.

The case is scheduled to be heard before the division bench on August 11, 2023.

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