M/S Ganesh Kumar vs. The State Of Bihar

Facts

The petitioner, M/s Ganesh Kumar, challenged an ex parte order passed by the Additional Commissioner State Taxes (Appeal), Patna West, Patna. The appeal was filed in time, but the Appellate Authority dismissed it for non-prosecution. The stated reason for dismissal was the petitioner's failure to produce supporting documents despite being granted an opportunity, and the fact that the supplier was not issued a notice in the appeal. The petitioner sought to set aside this dismissal order.

Held

The Court held that the Appellate Authority has a duty and obligation under Section 107 of the Bihar Goods and Services Tax Act, specifically sub-sections (8), (9), (10), (11), and (12), to look into the merits of the matter and examine the grounds raised by the appellant. Even when considering an appeal ex parte, the Appellate Authority must consider the grounds raised in the memorandum of appeal and decide the issue on merits. Failing to do so would be an abdication of its powers. The Court noted that the Appellate Authority is empowered to conduct further inquiries as necessary to decide the appeal, and any such decision must be on the points raised. The Court set aside the impugned order and directed the restoration of the appeal before the Appellate Authority. The petitioner is to appear on 25.07.2023, and the Appellate Authority shall fix a hearing date, dispose of the appeal on merits within three months from the last hearing, and pass a speaking order even in the absence of the appellant. The ratio is that an appellate authority cannot dismiss an appeal for non-prosecution without considering its merits, as mandated by statute.

Key Issues

1. Whether the Appellate Authority, under the Bihar Goods and Services Tax Act, has a statutory duty to decide an appeal on its merits, even when considering it ex parte, by examining the grounds raised by the appellant? Petitioner's contention: The petitioner argued that the Appellate Authority has a statutory obligation under Section 107 of the Bihar Goods and Services Tax Act to examine the merits of the appeal and the grounds raised by the appellant. Dismissing the appeal for non-prosecution without considering the merits amounts to an abdication of its powers. The petitioner relied on the Court's previous decision in Purushottam Stores vs. The State of Bihar & Ors. Revenue's contention: The judgment does not record any specific arguments made by the respondent revenue.