Hemant Kumar Gupta vs. State Of Bihar

Held

The Court held that the petitioner is entitled to the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act, subject to the deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, in addition to any amounts already deposited under Sub-Section (6) of Section 107 of the B.G.S.T. Act. The Court reasoned that the petitioner should not be deprived of this benefit due to the non-constitution of the Tribunal by the respondents. The recovery of the balance amount and any steps taken for its recovery were deemed to be stayed. The Court also directed that the petitioner must file their appeal under Section 112 of the B.G.S.T. Act once the Tribunal is constituted and functional, within a period to be specified upon its constitution. If the petitioner fails to file the appeal within the stipulated period after the Tribunal's constitution, the respondent authorities would be at liberty to proceed in accordance with law. The Court also ordered the release of any attachment on the petitioner's bank account if the 20% deposit is made, and clarified that previously deposited amounts would be accounted for in determining the 20% payment. The Court left it to the Assessing Officer to compute the amounts paid and determine if the 20% has been met.

Facts

The petitioner, Hemant Kumar Gupta, proprietor of M/s Laxmi Store, filed a writ petition seeking to avail the statutory remedy of appeal before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax (B.G.S.T.) Act. However, the Tribunal was not constituted, preventing the petitioner from filing an appeal and obtaining a stay on the recovery of the balance tax amount as per Section 112(8) and (9) of the Act. The State authorities acknowledged the non-constitution of the Tribunal and issued a notification (Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019) under Section 172 of the B.G.S.T. Act, stipulating that the limitation period for appeal would commence only after the Tribunal's President entered office. The petitioner had already deposited some amounts earlier under Section 107(6) of the B.G.S.T. Act.

Key Issues

1. Whether the petitioner is entitled to the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act, despite the non-constitution of the Appellate Tribunal, upon depositing 20 percent of the remaining amount of tax in dispute, in addition to amounts already deposited under Section 107(6)? Petitioner's contention: The petitioner argued that they are being deprived of their statutory remedy and the benefit of stay due to the respondents' failure to constitute the Tribunal. They contended that the benefit of stay should be extended to them upon fulfilling the deposit requirements, as they cannot be penalized for a deficiency on the part of the authorities. They relied on the principle that a litigant should not suffer due to administrative inaction and cited the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others. Revenue/State's contention: The respondent State authorities acknowledged the non-constitution of the Tribunal and issued a notification under Section 172 of the B.G.S.T. Act to address the situation, indicating that the limitation period for filing appeals would commence after the Tribunal's constitution. They did not present any specific argument against the petitioner's claim for a stay but implicitly accepted the need for a procedural adjustment.