M/S Patliputra Home Decor vs. Union Of INDIA

CWJC/3730/2023HC PatnaGSTCNR BRHC01015795202310 April 2023Bench: THE CHIEF JUSTICE-,MR. JUSTICE MADHURESH PRASAD4 pages

AI SummaryPartly Allowed

Facts

The petitioner, M/s Patliputra Home Decor, filed a writ petition before the Patna High Court seeking to avail the statutory remedy of appeal under Section 112 of the Bihar Goods and Services Tax (B.G.S.T.) Act before the Appellate Tribunal. However, the petitioner was unable to file the appeal due to the non-constitution of the Tribunal. This prevented them from availing the benefit of a stay of recovery of the balance tax amount, as contemplated under Section 112(8) and (9) of the B.G.S.T. Act, upon depositing the required amounts. The respondent State authorities acknowledged the non-constitution of the Tribunal and issued a notification (Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019) under Section 172 of the B.G.S.T. Act, which stipulated that the period of limitation for filing an appeal would commence only after the President of the Tribunal entered office.

Held

The Court held that the petitioner should be extended 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 percent of the remaining amount of tax in dispute, in addition to any amount already deposited under Sub-Section (6) of Section 107 of the B.G.S.T. Act. The Court reasoned that the petitioner should not be deprived of this benefit due to the non-constitution of the Tribunal by the respondents. Consequently, the recovery of the balance amount and any steps taken in that regard were deemed to be stayed. The Court also held that this relief cannot be open-ended. Therefore, the petitioner would be required to file their appeal under Section 112 of the B.G.S.T. Act once the Tribunal is constituted and functional. If the petitioner fails to file the appeal within the period specified after the Tribunal's constitution, the respondents would be at liberty to proceed in accordance with law. The Court noted that similar relief had been granted in the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others.

Key Issues

1. Whether the petitioner is entitled to the statutory benefit of stay of recovery of the balance amount of tax under Section 112(9) of the B.G.S.T. Act, despite the non-constitution of the Appellate Tribunal, upon depositing a specified percentage of the disputed tax amount? Petitioner's Argument: The petitioner contended that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay of recovery due to the respondents' failure to constitute the Appellate Tribunal. They argued that they should not be penalized for a situation beyond their control and should be granted the stay upon fulfilling the deposit requirements. Revenue/State's Argument: The respondent State authorities acknowledged the non-constitution of the Tribunal and had issued a notification to address the issue of limitation. While not explicitly recorded as making an argument against the stay, their actions indicated an acknowledgment of the procedural difficulty faced by the petitioner.

Sections Cited

Section 112, Section 107, Section 172

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.3730 of 2023 ====================================================== M/s Patliputra Home Decor (GSTIN ID-10AASFP6616M12V), through its Proprietor Ms Arti Devi aged about 52 Years, Sex Female, Address-Ground Floor Gulab City Mahua bagh Bailey Road, Thana Rupaspur, District Patna PIn 801506 ... ... Petitioner/s Versus 1. Union of India through the Secretary, Ministry of Finance, Department of Revenue, North Block New Delhi110001. 2. The State of Bihar through Principal Secreary Cum Commissioner State Goods and Service Tax, Department, Government of bihar, Vikash Bhawan, Patna-800001 3. Principal Chief Commissioner of CGST and Customs having its Office at Central Revenue Building, (Annexe), Bir Chand Patel Marg, Patna. 4. Shri Jeevan Agrawal , the Addl. Commissioner Tax Department (Appeal), Patna West Division, Pant Bhawan Baily Road, Patna-800001 5. The Assistant Commissioner, Danapur Circle, Tax Department Office of the Joint Commissioner, Pant Bhawan, Baily Road, Patna-80001 ... ... Respondent/s ====================================================== Appearance : For the Petitioner : Mr. Sudhir Kumar Sinha, Advocate Mr. Aayush Abhishek, Advocate Mr. Vivekanand, Advocate Ms. Deepika Sharma, Advocate For the Union of India : Dr. K.N. Singh, ASG Mr. Anshuman Singh, CGC ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE MADHURESH PRASAD

ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE) Date : 10-04-2023 The instant writ petition has been filed under Article 226 of the Constitution of India seeking multifarious reliefs. The petitioner essentially is desirous of availing statutory remedy of appeal against the impugned order before 2/4 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. 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.

3/4 This Court is, therefore, inclined to dispose of the instant writ petition in the following terms:- (i) Subject to deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, 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, the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act. The petitioner cannot be deprived of the benefit, due to non- constitution State of Bihar & Others in C.W.J.C. No. 15465 of 2022. (ii) 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. (iii) In case the petitioner chooses not to avail the remedy of appeal by filing any appeal under Section 112 of the B.G.S.T. Act before the 4/4 Tribunal within the period which may be specified upon constitution of the Tribunal, the respondent- Authorities would be at liberty to proceed further in the matter, in accordance with law. With the above liberty, observation and directions, the writ petition stands disposed of.

Sumit/Shashank- (K. Vinod Chandran, CJ) ( Madhuresh Prasad, J) AFR/NAFR CAV DATE Uploading Date 11.04.2023 Transmission Date

Reproduced from the public record of the Patna High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.