National Co-Operative Consumer Federation Of INDIA Limited vs. The State Of Bihar

Held

The Court held that the impugned appellate order dated March 15, 2022, and the underlying assessment orders dated March 7, 2020, and February 10, 2021, along with the summary of order dated March 13, 2020, were bad in law. The Court found that the order was passed in violation of the principles of natural justice, as the petitioner was not afforded a fair opportunity of hearing and the order was passed ex parte without sufficient reasoning. The Court also noted that the authorities had not adjudicated the matter on the attending facts and circumstances. Consequently, the Court quashed and set aside the impugned orders. The Court directed the petitioner to deposit ten percent of the total amount (if not already deposited) and additionally ten percent of the demand raised before the Assessing Officer within four weeks. Bank accounts, if attached, were to be de-frozen. The Assessing Authority was directed to decide the case on merits after complying with principles of natural justice, affording adequate opportunity to all parties, and passing a speaking order within two months of the petitioner's appearance. No coercive steps were to be taken against the petitioner during this period. The Court explicitly stated that it had not expressed any opinion on the merits of the case and all issues were left open.

Facts

The petitioner, National Co-operative Consumer Federation of India Limited, filed a writ petition challenging an appellate order dated March 15, 2022, passed by the Additional Commissioner of State Tax (Appeal), Patna. This appellate order had rejected the petitioner's appeals against assessment orders dated March 7, 2020, and February 10, 2021, passed by the Assistant Commissioner of State Tax. The summary of order dated March 13, 2020, issued in Form GST DRC-07, was also part of the challenge. The petitioner contended that the appellate order was ex parte and lacked sufficient reasons, violating principles of natural justice. The Revenue stated it had no objection to the matter being remanded for fresh decision on merits, without limitation issues arising and without coercive steps.

Key Issues

1. Whether the appellate order dated March 15, 2022, passed by the Additional Commissioner of State Tax (Appeal) is bad in law due to violation of principles of natural justice, specifically the lack of a fair opportunity of hearing and the ex parte nature of the order without sufficient reasoning? 2. Whether the assessment orders dated March 7, 2020, and February 10, 2021, and the summary of order dated March 13, 2020, should be quashed and set aside? Petitioner's Arguments: The petitioner argued that the appellate order was passed ex parte without affording sufficient time for representation and lacked adequate reasoning for determining the amount due. They also claimed the authorities failed to adjudicate on the attending facts and circumstances. The petitioner sought a direction to treat the case as one and allow Input Tax Credit (ITC) even for non-reflected transactions in GSTR-2A. Revenue's Arguments: The Revenue did not object to the matter being remanded to the Assessing Authority for a fresh decision on merits, agreeing that limitation would not be a bar and no coercive steps would be taken against the petitioner.