M/S Planning And Infrastructural Development Consultants PVT. LTD. (Pidcpl) vs. State Of Bihar

Held

The Court held that the impugned orders were bad in law for two primary reasons: (a) violation of the principles of natural justice, specifically the lack of a fair opportunity of hearing and insufficient time afforded to the petitioner to present their case, and (b) the ex parte nature of the orders, which did not provide sufficient reasoning for determining the amounts due. The Court also noted that the authorities had not adjudicated the matter on the attending facts and circumstances, failing to deal with all issues of fact and law. Consequently, the Court quashed and set aside the impugned orders passed by the Additional Commissioner of State Taxes (Appeal) and the Assistant Commissioner, Central GST and Central Excise, along with the summary of order. The Court directed the petitioner to deposit ten percent of the total demand within four weeks, without prejudice to their rights. The bank accounts of the petitioner were ordered to be de-frozen. The Assessing Authority was directed to decide the case on merits after complying with the principles of natural justice, affording adequate opportunity to all parties, and passing a speaking order within two months. 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, leaving all issues open.

Facts

The petitioner, M/s Planning and Infrastructural Development Consultants Pvt. Ltd. (PIDCPL), filed a writ petition challenging an order dated February 25, 2022, passed by the Additional Commissioner of State Taxes (Appeal). This order rejected the petitioner's appeals against six orders dated August 8, 2019, September 11, 2019, October 11, 2019, November 14, 2019, December 17, 2019, and January 11, 2020, passed by the Assistant Commissioner, Central GST and Central Excise. The petitioner also challenged a summary of order dated October 4, 2019, issued in Form GST DRC-07. The impugned orders were described as ex parte in nature. The revenue, through its counsel, agreed to a remand to the Assessing Authority for a fresh decision on merits, without limitation being an impediment, and without coercive steps during the pendency of the case.

Key Issues

1. Whether the impugned orders passed by the Assistant Commissioner and the appellate order rejecting the appeals are bad in law due to violation of principles of natural justice, specifically the right to a fair opportunity of hearing and the passing of ex parte orders without sufficient reasons? (Relates to principles of natural justice and procedural fairness). Petitioner's Contention: The petitioner argued that the orders were passed ex parte, without affording sufficient time or opportunity to represent their case, and lacked sufficient reasoning for determining the amounts due. They contended that these procedural defects rendered the orders bad in law. Revenue's Contention: The counsel for the Revenue stated they had no objection to the matter being remanded to the Assessing Authority for a fresh decision on merits, and that limitation should not be a bar. They also agreed that no coercive steps should be taken against the petitioner during the pendency of the case.