M/S Power House Equipments PVT. LTD. vs. The State Of Bihar, Through The Principal Secretary Cum- Commissioner

Held

The Court quashed and set aside both the impugned order dated February 15, 2021, of the Additional Commissioner, Tax (Appeal), and the order dated December 14, 2018, of the Assistant Commissioner of State Tax. The Court accepted the submission that the delay in filing the appeal was sufficiently explained by COVID-19 restrictions. The Court directed the Appellate Authority to condone the delay and decide the appeal on merits after affording adequate opportunity to all parties, including the writ petitioner. The Court also directed the de-freezing/de-attaching of the petitioner's bank account(s) if attached in reference to the proceedings. The Court noted that ten percent of the total amount, a prerequisite for hearing the appeal, had been deposited, and if not, it was to be done before the next date. This deposit was to be without prejudice to the parties' rights and subject to the final order. The Court explicitly stated that it had not expressed any opinion on merits and all issues were left open for the Appellate Authority to decide. The Appellate Authority was directed to pass a speaking order expeditiously, preferably within two months from the petitioner's appearance.

Facts

The petitioner, M/s Power House Equipments Pvt. Ltd., challenged an order dated February 15, 2021, passed by the Additional Commissioner, Tax (Appeal), Central Division, Patna. This order dismissed the petitioner's appeal against an order dated December 14, 2018, passed by the Assistant Commissioner of State Tax, Patliputra Circle, Patna, solely on the grounds of being time-barred. The original order dated December 14, 2018, had demanded Rs. 9,92,520/- as tax (CGST and SGST) and Rs. 1,63,760/- for non-filing of GSTR3B for August 2017, despite the petitioner claiming to have filed it on November 1, 2018. The petitioner sought setting aside of both orders, return of the recovered tax amount, and release of their frozen bank account.

Key Issues

1. Whether the appeal filed before the Additional Commissioner, Tax (Appeal) was barred by limitation, considering the circumstances of COVID-19 restrictions? (Question of law) Petitioner's contention: The delay in filing the appeal was sufficiently explained due to COVID-19 restrictions, and the appellate authority ought to have considered the appeal on merits. The petitioner also argued that the demand for August 2017 was erroneous as the GSTR3B was filed, and other demands for different periods were rectified or annulled, but August 2017 was not, without valid reason. Revenue's contention: The Revenue stated it had no objection if the matter was remanded to the Appellate Authority for deciding the appeal afresh, without taking the ground of delay into account and deciding on merits. They also agreed that no coercive steps would be taken against the petitioner during the pendency of the appeal.