Dismissed

FPA-1/BOM/2007 of Hirabhai Morarbhai Tandel v. The Competent Authority, Safema, Ahmedabad

ATFP3 Jun 2024FPA-1/BOM/2007

Case brief

AI extract

What is this about?

Appeal filed with a 27-year delay. Bench held that Section 12(4) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 strictly limits appeal filing to 60 days. Exception of 15 days condonation not applicable to this gap. Appeal dismissed.

What did the court decide?

Application for condonation of delay and the appeal were dismissed.

FPA-1/BOM/2007 of Hirabhai Morarbhai Tandel… — Constitutional and Fundamental Rights | ATFP (2024)

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APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI

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MP 228A/BOM/2018 (Misc.) MP-9/BOM/2007 (COD) MP-10/BOM/2007 (Stay) FPA-1/BOM/2007

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Hirabhai Morarbhai Tandel … Appellant

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Versus

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The Competent Authority, SAFEMA, Ahmedabad … Respondent

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Advocates/Authorized Representatives who appeared

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For the Appellant : Shri Aseem Thakkar, C.A. For the Respondent : Shri Karuna Nidhar, Advocate

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CORAM

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JUSTICE MUNISHWAR NATH BHANDARI : CHAIRMAN SHRI BALESH KUMAR : MEMBER

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FINAL ORDER 03.06.2024

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FPA-1/BOM/2007

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Thisappeal was earlier dismissed by this Tribunal on 18.03.2008 finding delay of 27 years in filing the appeal. As per Section 12(4) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (in short `the Act of 1976), the delay was not condonable beyond a period of 15 days after a period of 45 days for filing an appeal.

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Going contrary to the statutory provisions, the appellant preferred an appeal before the High Court to challenge the said

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FPA-1/BOM/2007

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Page 1 of 8

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order. The Gujarat High Court set aside the order of this Tribunal by its order dated 16.07.2008 in Appeal No. 20468/2008.The Gujarat High Court directed the Tribunal to hear and decide the application preferred by the appellant afresh, as well as the stay application, keeping in mind the provisions of sub-rules (7) and (8) of Rule 6 of the Act, for merits and in accordance with the law. The appeal was subsequently posted from time to time before the Tribunal and is now listed before us after the reconstitution of the Tribunal. 3. The learned counsel for the appellant prayed for condonation of delay in the light of the observations made by the High Court and thereupon to decide the appeal on merit. It is submitted that the appellant was not served with the show cause notice, rather he was out of India at the relevant time thus an opportunity of hearing was not given by the Competent Authority, although it was provided under the Act of 1976.

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The appellant filed a petition before the Gujarat High Court. Gujarat High Court passed an interim order in Appeal No. 20468/2008 against the order of the Competent Authority. However, when the order of the High Court was challenged before the Apex Court, the interim order passed by the High Court of Gujarat was stayed on 25.10.1989. The appellant then withdrew the petition due to the stay granted by the Supreme Court, and accordingly, the stay was vacated.

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FPA-1/BOM/2007

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Page 2 of 8

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The appellant then filed an appeal against the order passed by the Competent Authority in the year 1980, along with an application for condonation of delay due to litigation before the Gujarat High Court. The prayer is to condone the delay and decide the appeal.

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The application for condonation of delay has been vehemently opposed by the respondent‟s counsel. It is submitted that, as per Section 12(4) of the Act of 1976, the period for filing the appeal is of 45 days. Beyond this period, the appeal can be entertained 15 days thereafter subject to explanation of delay. There is a statutory restraint on entertaining the appeal beyond 60 days. Therefore, this Tribunal should not exercise this power in contravention of the statutory provision.

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The Gujarat High Court set aside the earlier order passed by this Tribunal on 18.03.2008 because the specific argument in reference to Section 12(4) was not brought to its notice. The Tribunal was careful in passing the order and for that even quoted Section 12(4).

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The counsel for the respondent has given reference of the judgment of the Apex Court in the case of Union of India Vs. Popular Construction Co. reported in AIR 2001 SC 4010 to support his argument. It has been held that if special litigation restrictscondonation of delay beyond a period, the general legislation of Limitation Act would not apply. The Courts or for

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FPA-1/BOM/2007

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Page 3 of 8

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that Tribunal should not entertain the appeal beyond the permissible period. The judgment was given in reference to the similar provision of Section 34 of the Arbitration and Conciliation Act, 1996 (in short `the Act of 1996) and covers the issue raised in this appeal. The prayer is accordingly to dismiss the application for condonation of delay as the appeal was filed after 27 years of the impugned order dated 06.09.1980.

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We have considered the rival submissions of the parties and perused the record. It is a case where the appeal was earlier dismissed due to a delay of 27 years in filing the appeal. The Tribunal had passed a detailed order on March 18, 2008, specifically referring to Section 12(4) of the Act of 1976. However, the order of the Tribunal was challenged before the Gujarat High Court, and subsequently, the Tribunal‟s order was set aside in Appeal No. 20468/2008. The High Court directed that the application for condonation of delay and the stay application be heard afresh.

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Since the appeal has been filed beyond the period of limitation, an application for condonation of delay has been filed. We must address the issue on condonation of delay at the first instance, as the merits of the case can be considered only if the delay in filing the appeal is condoned.

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To address the issue, we may refer to Section 12(4) of the Act of 2002 and, for ready reference,it is quoted hereunder:

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FPA-1/BOM/2007

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Page 4 of 8

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“12(4)Any person aggrieved by an order of the competent authority made under section 7, sub-section (1) of section 9 or section 10, may, within forty-five days from the date on which the order is served on him, prefer an appeal to the Appellate Tribunal.

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Provided that the Appellate Tribunal may entertain any appeal after the said period of forty-five days, but not after sixty days, from the date aforesaid if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time”.

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The Statute gives period of 45 days for filing the appeal but the proviso appended to sub-section (4) to Section 12 allows the Appellate Tribunal to entertain an appeal after the period of 45 days but not after 15 days and that too when the appellant gives satisfactory explanation of delay of 15 days after expiry of 45 days.

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In Popular construction Co. (supra),Apex Court had considered the language of Section 34 of the Act of 1996. It was held that the crucial words therein „but not thereafter‟ used in the proviso to sub-section (3) of Section 34 of the Act of 1996 would amount to an express exclusion of the Limitation Act, and would therefore bar theapplication of Section 5 of the Limitation Act. To hold that the court can entertain an application to set aside the Award beyond the extended period under the proviso, would render the phrase “but not thereafter” wholly otiose.

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The counsel for the respondent has furthergiven reference of the judgment of the Apex Court in the case of Assam Urban

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Water SupplyVersus M/s. Subash Projects & Marketing

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FPA-1/BOM/2007

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Page 5 of 8

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Ltd. reported in 2012 AIR SCW 1395to support his argument. It has been held that section 34(3) of the Act of 1996 provides that an application for setting aside an award may be made within 3 months of the receipt of the arbitral award. The proviso that follows sub section (3) of section 34 provides that on sufficient cause being shown, the court may entertain the application for setting aside the award after the period of three months and within a further period of 30 days but not thereafter.

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This Tribunal and for that court would not pass an order against the statutory provision; rather, they would be bound by the provision unless declared to be unconstitutional. The reason is that until the provision is declared unconstitutional, a presumption about its constitutional validity remains.

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In the instant case, the appeal was filed with a delay of 27 years. The impugned order was passed on 06.09.1980, and the appeal was filed in the year 2007. It is a case where the appeal was earlier dismissed by this Tribunal, finding the delay of 27 years to be not condonable. The order of the Tribunal was challenged before the Gujarat High Court, and the Tribunal‟s order was set aside in Appeal No. 20468/2008. The appellant may have been pursuing theremedy before the Gujarat High Court against the order of the Competent Authority and obtained a stay, but the Supreme Court interfered in the interim order passed by the Gujarat

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FPA-1/BOM/2007

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Page 6 of 8

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High Court, and ultimately, the appellant withdrew the petition before the High Court much before filing the appeal. In those circumstances, and considering the statutory provisions, an appeal filed beyond a period of 60 days cannot be entertained, going against Section 12(4) of the Act of 1976. The condonable period is 15 days after 45 days for filing the appeal. Beyond the period of 60 days, this Tribunal cannot entertain an appeal going against the statute.

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Thecounsel for the respondent has supported his argument by referring to the judgment of the Apex Court even in the case of State of Maharashtra Vs. Hindustan

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Construction Company Limited reported in AIR 2010 SC 1299. We find that the issue has been elaborately discussed in reference to the similar provision as exists under Section 12(4) of the Act of 1976. In the aforesaid case, Court emphasised the mandatory nature of the limit to the extension of the period provided in proviso to Section 34(3) and held that an application for setting aside arbitral award under section 34 of the 1996 Act has to be made within the time prescribed under sub section (3) of section 34,i.e., within 3 months and a further period of 30 days on sufficient cause being shown and not thereafter.

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In the light of the judgments referred to above and Section 12(4) of the Act of 1976, we are unable to accept the application for condonation of delay of 27 years in filing the

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FPA-1/BOM/2007

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Page 7 of 8

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appeal and in absence of condonation, we cannot enter into other issues by flouting the statutory provisions. It is necessary to clarify that if the judgment of the Court goes against the statutory provisions, it is to be considered per incuriam and not binding.

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