M/S Manikant Singh vs. The State Of Bihar

Facts

The petitioner filed a writ petition before the Patna High Court challenging an order dated February 13, 2021, passed by the Additional Commissioner of State Taxes (Appeal), Purnea Division, which rejected their appeal solely on the grounds of delay. This appeal was preferred against an earlier order dated February 13, 2020, by the Joint Commissioner of State Tax, Purnea Circle. The petitioner also challenged related orders concerning GST DRC-07 and GST DRC-8, both dated July 1, 2020. The petitioner stated that the entire demand raised by the department had been recovered. The Revenue had no objection to the matter being remanded for fresh decision on merits.

Held

The Court quashed and set aside the impugned order dated February 13, 2021, passed by the Additional Commissioner of State Taxes (Appeal), and all other related orders challenged by the petitioner. The Court directed that the case be decided on merits by passing a speaking order, complying with the principles of natural justice. If it was ultimately found that the amount recovered from the petitioner was in excess, it was to be refunded within two months of the order. The Court also directed the de-freezing/de-attaching of the petitioner's bank accounts, if attached. The petitioner undertook to appear before the Assessing Authority on August 9, 2021, and cooperate in the proceedings. The Assessing Authority was directed to decide the case expeditiously, preferably within two months from the petitioner's appearance, after affording adequate opportunity to all concerned. 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.

Key Issues

1. Whether the appeal filed by the petitioner before the Additional Commissioner of State Taxes (Appeal) was liable to be rejected on the ground of delay, thereby precluding a decision on merits? (Mixed question of law and fact) 2. Whether the orders passed by the revenue authorities, which were ex-parte in nature, were sustainable? Petitioner's Arguments: The petitioner contended that their appeal was rejected merely on the ground of delay, and both the appellate order and the original order were ex-parte. They also stated that the entire amount demanded by the department had already been recovered. Revenue's Arguments: The Revenue stated that they had no objection if the matter was remanded to the Assessing Authority for deciding the case afresh on merits. They also agreed that no coercive steps would be taken against the petitioner during the pendency of the case.