M/S Agarwal Computer vs. The State Of Bihar

Facts

The petitioner, M/s Agarwal Computer, challenged an assessment order and rectification order dated February 10, 2021, passed by the Assistant Commissioner of State Tax, Katihar Circle. This order imposed a total additional liability of Rs. 2,98,744.34, comprising Rs. 1,90,180.96 as tax, Rs. 83,679.61 as interest, and Rs. 24,883.77 as penalty for the period 2018-19. The petitioner's subsequent appeal before the Additional Commissioner State Tax (Appeal), Purnea Division, was rejected on August 17, 2021, on the technical ground that a certified copy of the assessment order was not filed within seven days of filing the appeal. The petitioner sought to quash these orders and prevent coercive action.

Held

The Court quashed and set aside the appellate order dated August 17, 2021, and restored the petitioner's appeal to its original file. The Court accepted the petitioner's statement that ten percent of the total amount, a prerequisite for hearing the appeal, had been deposited. The appeal is to be decided on merits, with the Appellate Authority condoning the delay in filing the appeal due to COVID-19 restrictions, in line with Apex Court directions. The Court directed the de-freezing of the petitioner's bank accounts if attached. The Appellate Authority is to decide the appeal expeditiously, preferably within two months, after affording adequate opportunity to both parties and complying with the principles of natural justice. No coercive steps are to be taken against the petitioner during the pendency of the appeal. The Court explicitly stated that it had not expressed any opinion on the merits of the case, leaving all issues open.

Key Issues

1. Whether the Appellate Authority erred in rejecting the petitioner's appeal on a technical ground (non-filing of a certified copy of the assessment order within seven days) when the delay was attributable to COVID-19 restrictions, thereby violating the directions of the Apex Court in suo motu case No. 3/20 regarding limitation periods? (Question of law) Petitioner's Argument: The petitioner contended that the delay in filing the certified copy was sufficiently explained by the COVID-19 restrictions and that the Apex Court's directions in suo motu case No. 3/20 should have been applied to condone the delay. The rejection of the appeal on a technicality was arbitrary and illegal. Revenue's Argument: The learned counsel for the Revenue stated they had no objection if the matter was remanded to the Appellate Authority for a fresh decision on merits, without taking the ground of delay into account. They also agreed that no coercive steps should be taken against the petitioner during the pendency of the appeal.