M/S Tirupati Automobiles (A Sole Proprietor Ship Firm) vs. The Union Of INDIA
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The petitioner, M/s Tirupati Automobiles, filed a writ petition seeking to avail the statutory remedy of appeal before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax (BGST) Act. However, the Tribunal had not been constituted, preventing the petitioner from filing the appeal and consequently from obtaining a stay on the recovery of the balance tax amount as provided under Section 112(8) and (9) of the BGST Act. The respondent State authorities acknowledged the non-constitution of the Tribunal and issued an order under Section 172 of the BGST Act, stating that the limitation period for filing an appeal would commence only after the constitution of the Tribunal and the President entering office. The petitioner sought relief from the High Court due to this procedural impediment.
Held
The Court held that the petitioner cannot be deprived of the statutory benefit of stay under Section 112(9) of the BGST Act due to the non-constitution of the Tribunal by the respondents. The Court reasoned that the respondents themselves are responsible for the delay in the constitution of the Tribunal, and therefore, the petitioner should not suffer for it. The Court directed that subject to the deposit of 20 percent of the remaining amount of tax in dispute (in addition to any amount already deposited under Section 107(6) of the BGST Act), the petitioner shall be extended the statutory benefit of stay. The recovery of the balance amount and any steps taken in this regard would be deemed stayed. The Court also held that this stay cannot be open-ended and that the petitioner would be required to file their appeal under Section 112 of the BGST Act once the Tribunal is constituted and made functional. The Court noted that similar relief was granted in the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others. The Court also clarified that if the petitioner chooses not to avail the remedy of appeal after the Tribunal is constituted, the respondent authorities would be at liberty to proceed further.
Key Issues
1. Whether the petitioner can be deprived of the statutory benefit of stay under Section 112(9) of the BGST Act due to the non-constitution of the Appellate Tribunal by the respondent authorities? 2. Whether the period of limitation for filing an appeal under Section 112 of the BGST Act should commence only after the Tribunal is constituted and functional? Petitioner's arguments: The petitioner contended that they are being prevented from availing their statutory remedy of appeal and the consequential benefit of stay on recovery due to the respondents' failure to constitute the Tribunal. They argued that the non-constitution of the Tribunal should not prejudice their right to seek a stay on recovery, especially when the limitation period is also affected. They relied on the principle that a party should not suffer due to the inaction of the authorities. Revenue/State's arguments: The respondent authorities acknowledged the non-constitution of the Tribunal and had issued an order under Section 172 of the BGST Act to address the situation, indicating that the limitation period would commence upon the Tribunal's constitution. They did not dispute the petitioner's inability to file an appeal.
Sections Cited
Section 112, Section 172, Section 107, Section 109
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Cause title — parties, addresses and appearances
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 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").
2/4 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. 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 3/4 (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 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 4/4 writ petition stands disposed of.
Rajkishore/ Shyam Bihari/- (K. Vinod Chandran, CJ) (Madhuresh Prasad, J) AFR/NAFR NAFR CAV DATE N/A Uploading Date 11.04.2023 Transmission Date N/A
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.