M/S Kessar Vacine Distributors vs. The 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, 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. Consequently, 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 would be required to present/file their appeal under Section 112 of the B.G.S.T. Act once the Tribunal is constituted and made functional. This appeal must be filed observing statutory requirements to facilitate its consideration. 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. The Court also ordered the release of any attachment on the petitioner's bank account if the 20 percent deposit is made. The Court relied on a similar relief granted in the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others.

Facts

The petitioner, M/s Kessar Vacine Distributors, 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 petitioner was unable to file the appeal due to the non-constitution of the Tribunal. This prevented the petitioner from availing the benefit of a stay on the recovery of the balance tax amount, which is contingent upon depositing a specified portion of the disputed tax 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 (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 limitation period for filing appeals would commence only after the Tribunal's President entered office.

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 disputed tax amount? 2. Whether the petitioner should be required to file their appeal under Section 112 of the B.G.S.T. Act once the Tribunal is constituted and functional? Petitioner's Arguments: The petitioner argued that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay on recovery due to the inaction of the respondents in constituting the Tribunal. They contended that they should not be penalized for a situation beyond their control and should be granted the stay upon fulfilling the deposit requirements. Revenue/State's Arguments: The respondent State authorities acknowledged the non-constitution of the Tribunal and had issued a notification to address the difficulties arising from it. They did not contest the petitioner's right to seek relief under the given circumstances.