Bihar does not have a GSTAT, thus HC grants are still subject to a 20% tax payment
Fact and issue of the case
The following reliefs are sought in the current writ petition, which was submitted in accordance with Article 226 of the Indian Constitution:
“a) For issuance of writ in the nature of certiorari for quashing of the ex parte order passed by the respondent number 2 in exercise of power under section 73 of the Central Goods And Services Tax Act, 2017, and the Bihar Goods And Services Tax Act, 2017, and also for quashing of the summary of order issued in form GST DRC-07 dated 07.02.2021 in accordance with s.
b) To further issue a writ in the nature of certiorari for the quashing of the appellate order dated 28.01.2023 issued by respondent number 2 pursuant to memo number 166 whereby the petitioner’s appeal against the respondent number 3’s order dated 07.02.2021 has been rejected without giving consideration to the various issues of fact and law raised by the petitioner;
c) To prevent the respondents from taking any further coercive action against the petitioner in order to recover the amount of tax, interest, and penalty under the contested ex parte order of respondent number 3 that was upheld by respondent number 2 in appeal as there is currently no GST tribunal in the state of Bihar, and the petitioner has no statutory remedy;
d) For further holding and a declaration that the petitioner cannot lose the advantage of the input tax credit due to a simple discrepancy between the return submitted by the petitioner in form GSTR-3B and the lack of an auto-populated GSTR-2A;
e) For the granting of any further reliefs that the petitioner is judged to be entitled to under the circumstances of this case.
The petitioner is desirous of availing statutory remedy of appeal against the impugned order before the Appellate Tribunal (hereinafter referred to as “Tribunal”) under Section 112 of the Bihar Goods and Services Tax Act (hereinafter referred to as “B.G.S.T. Act”).
However, due to non-constitution of the Tribunal, the petitioner is deprived of his statutory remedy under Sub-Section (8) and Sub-Section (9) of Section 112 of the B.G.S.T. Act.
Under the circumstances, the petitioner is also prevented from availing the benefit of stay of recovery of balance amount of tax in terms of Section 112 (8) and (9) of the B.G.S.T Act upon deposit of the amounts as contemplated under Sub-section (8) of Section 112.
Observation of the court
The respondent State authorities have acknowledged the fact of non-constitution of the Tribunal and come out with a notification bearing Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019 for removal of difficulties, in exercise of powers under Section 172 of the B.G.S.T Act which provides that period of limitation for the purpose of preferring an appeal before the Tribunal under Section 112 shall start only after the date on which the President, or the State President, as the case may be, of the Tribunal after its constitution under Section 109 of the B.G.S.T Act, enters office.
This Court is, therefore, inclined to dispose of the instant writ petition in the following terms:-
The petitioner must be granted an extension of the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act, subject to the deposit of a sum equal to 20% of the remaining amount of tax in controversy, if not already deposited, in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act. Due to the respondents’ own failure to establish the Tribunal, the petitioner cannot be denied the benefit. Therefore, it will be assumed that the recovery of the remaining balance and all related actions have been put on hold. It is undeniable that this Court provided similar relief in the instance of SAJ Food Products Pvt. Ltd.
The statutory relief of stay, on deposit of the statutory amount, however in the opinion of this Court, cannot be open ended. For balancing the equities, therefore, the Court is of the opinion that since order is being passed due to non-constitution of the Tribunal by the respondent-Authorities, the petitioner would be required to present/file his appeal under Section 112 of the B.G.S.T. Act, once the Tribunal is constituted and made functional and the President or the State President may enter office. The appeal would be required to be filed observing the statutory requirements after coming into existence of the Tribunal, for facilitating consideration of the appeal.
The respondent-Authorities would be free to continue the case in accordance with the law if the petitioner decides not to use the remedy of appeal by filing any appeal under Section 112 of the B.G.S.T. Act before the Tribunal within the period that may be specified upon the Tribunal’s constitution.
The writ application is dismissed with the aforementioned liberties, observations, and instructions.
In the result, appeal of the assessee is allowed and ruled in favour of the assessee
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