M/S Dinesh Chandra R. Agrawal Infracon Private Limited vs. The State Of Bihar

Facts

The petitioner, M/s Dinesh Chandra R. Agrawal Infracon Private Limited, 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 Act (B.G.S.T. Act). However, the petitioner was unable to file the appeal due to the non-constitution of the Tribunal. This prevented them from availing the benefit of stay of recovery of the balance tax amount, which is contingent upon depositing a specified portion of the disputed tax as per 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 (Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019) under Section 172 of the B.G.S.T. Act, stating that the period of limitation for preferring an appeal would commence only after the constitution of the Tribunal and the President entering office.

Held

The Court held that the petitioner must be extended 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% of the remaining amount of tax in dispute, in addition to any amount already deposited under Sub-Section (6) of Section 107 of the B.G.S.T. Act. The Court reasoned that the petitioner cannot be deprived of this benefit due to the non-constitution of the Tribunal by the respondents. Recovery of the balance amount and any steps taken in that regard were deemed to be stayed. For balancing equities, the Court directed that the petitioner would be required to present/file their appeal under Section 112 of the B.G.S.T. Act once the Tribunal is constituted and functional. If the petitioner fails to file an appeal within the period specified upon the Tribunal's constitution, the respondent authorities would be at liberty to proceed in accordance with law. The Court also directed the release of any attachment of the petitioner's bank account if the stipulated deposit is made.

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% of the remaining disputed tax amount? The petitioner argued that they should not be deprived of this statutory benefit due to the respondents' failure to constitute the Tribunal. They relied on the principle that a party should not suffer due to the inaction of the authorities. The revenue/State did not record any specific argument against this point, but their actions and the notification indicate an acknowledgment of the situation. 2. What is the appropriate course of action to balance the equities and ensure the petitioner can eventually avail their appellate remedy once the Tribunal is functional? The petitioner sought directions from the Court to allow them to pursue their appeal. The Court considered the implications of the non-constitution of the Tribunal on the petitioner's rights.