Nirbhay Kumar Singh vs. The State Of Biahr

Facts

The petitioner, Nirbhay Kumar Singh, filed a writ petition before the Patna High Court seeking various reliefs, primarily to avail the statutory remedy of appeal under Section 112 of the Bihar Goods and Services Tax (B.G.S.T.) Act. The petitioner was unable to file an appeal before the Appellate Tribunal due to its non-constitution. This prevented the petitioner from 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, upon depositing the stipulated pre-deposit. The State authorities had 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 constitution of the Tribunal and the entry of the President into office.

Held

The Court held that the petitioner should 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 should not be deprived of this benefit due to the respondents' failure to constitute the Tribunal. The recovery of the balance amount and any related steps would be deemed stayed. However, the Court also held that this stay cannot be open-ended. 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. The appeal would need to be filed observing statutory requirements after the Tribunal's existence. 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 was influenced by a similar relief granted in the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others.

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, and if so, upon what conditions? Petitioner's contention: The petitioner argued that they are being deprived of a statutory remedy due to the inaction of the respondents in constituting the Tribunal. They sought to avail the benefit of stay of recovery of the balance amount, which is contingent upon filing an appeal and making a pre-deposit as per Section 112(8) of the B.G.S.T. Act. The petitioner relied on the fact that the limitation period for appeal has not yet commenced due to the non-constitution of the Tribunal. Respondent's contention: The respondent State authorities acknowledged the non-constitution of the Tribunal and had issued a notification under Section 172 of the B.G.S.T. Act to address the situation regarding the commencement of the limitation period for appeals.