M/S Suresh Pd. Arvind Kumar vs. The State Of Bihar

Facts

The petitioner, M/s Suresh Pd. Arvind Kumar, 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 provided 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) to address the difficulties, stating that the limitation period for appeal would commence only after the President of the Tribunal entered office.

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 a sum equal to 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. Consequently, the recovery of the balance amount and any steps taken in that regard 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, observing statutory requirements. If the petitioner fails to file the appeal within the specified period after the Tribunal's constitution, the respondents 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.

Key Issues

1. Whether the petitioner is entitled to the statutory benefit of stay under Section 112(9) of the B.G.S.T. Act, despite the non-constitution of the Appellate Tribunal, upon depositing a specified portion of the disputed tax amount? 2. Whether the recovery of the balance amount of tax and any steps taken for recovery should be stayed until the Appellate 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 failure of the respondents to constitute the Appellate Tribunal. They contended that they should not be prejudiced by this administrative lapse and should be allowed to avail the stay benefit upon fulfilling the deposit requirements. Revenue/State's Arguments: 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 issue of limitation. They did not dispute the petitioner's right to seek relief from the High Court in the absence of the Tribunal.