M/S Dra S And P Joint Venture vs. The State Of Bihar

Facts

The petitioner, M/s DRA S AND P JOINT VENTURE, 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 the appeal and consequently from availing the benefit of stay of recovery of the balance tax amount as stipulated under Section 112(8) and (9) of the B.G.S.T. Act. 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 such difficulties, stating that the limitation period for appeal would commence only after the Tribunal's constitution and the President's assumption of office. The petitioner sought relief from the High Court due to this procedural impediment.

Held

The Court held that the petitioner should be extended the statutory benefit of stay under Section 112(9) of the B.G.S.T. Act, subject to the deposit of 20 percent of the remaining amount of tax in dispute, in addition to any amount already deposited under Section 107(6) 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 it would be deemed 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. If the petitioner fails to file the appeal within that period, the respondents would be at liberty to proceed. The Court also ordered the release of any attached bank account of the petitioner upon compliance with the deposit requirement. The ratio is that statutory benefits should not be denied due to administrative delays in establishing statutory forums, and a balance of equities can be achieved through conditional relief.

Key Issues

1. Whether the petitioner is entitled to the statutory benefit of stay of recovery of the balance amount of tax under Section 112(9) of the B.G.S.T. Act, despite the non-constitution of the Appellate Tribunal? Petitioner's contention: The petitioner argued that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay of recovery due to the failure of the respondents to constitute the Tribunal. They contended that they should not suffer due to the administrative inaction of the State. Revenue's contention: The respondent State authorities acknowledged the non-constitution of the Tribunal and had issued a notification under Section 172 of the B.G.S.T. Act to address the situation, indicating that the limitation period for appeal would commence post-constitution. The judgment does not record any specific argument from the revenue against granting the relief sought by the petitioner, other than their acknowledgment of the factual situation.