New Jai Steel A Proprietory Concern vs. State Of Bihar

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 percent of the remaining amount of tax in dispute, if not already deposited. The Court reasoned that the petitioner cannot be deprived of this benefit due to the non-constitution of the Tribunal by the respondents. Consequently, the recovery of the balance amount and any steps taken in this regard were deemed to be stayed. The Court also directed that the stay would not be open-ended. The petitioner would be required to 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 the appeal within the specified period after the Tribunal's constitution, the respondent authorities would be at liberty to proceed. If the 20 percent deposit is made, any attachment of the petitioner's bank account pursuant to the demand shall be released. The Court relied on a previous order in the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others.

Facts

The petitioner, New Jai Steel, 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 Tribunal had not been constituted, preventing the petitioner from filing an appeal and availing the benefit of stay of recovery of the balance tax amount 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 appeal would commence only after the President of the Tribunal entered office. The petitioner sought directions from the High Court to address this situation.

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 tax in dispute? Petitioner's Contention: The petitioner argued that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay due to the respondents' failure to constitute the Tribunal. They contended that they should not suffer due to this administrative lapse and should be granted the stay upon fulfilling the deposit requirements. Revenue's Contention: The revenue authorities acknowledged the non-constitution of the Tribunal and issued a notification to address the issue of limitation. They did not explicitly argue against granting the stay but implicitly relied on the statutory provisions and the notification issued for removal of difficulties.