M/S Jyoti Forge And Fabrication vs. The State Of Bihar

Facts

The petitioner, M/s Jyoti Forge and Fabrication, filed a writ petition before the Patna High Court seeking to avail the statutory remedy of appeal under Section 112 of the Bihar Goods and Services Tax Act, 2017 (B.G.S.T. Act). However, 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 stipulated under Section 112(8) and (9) of the B.G.S.T. Act, upon depositing the required pre-deposit. 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.

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 cannot be deprived of this benefit due to the non-constitution of the Tribunal by the respondents themselves. The recovery of the balance amount and any related steps were deemed to be stayed. The Court also directed that 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 an appeal within the specified period after the Tribunal's constitution, the respondent authorities would be at liberty to proceed. The Court also ordered the release of any attachment of the petitioner's bank account upon compliance with the deposit requirement.

Key Issues

1. Whether the petitioner is entitled to the statutory benefit of stay of recovery of the balance amount of tax under Section 112(9) of the B.G.S.T. Act, despite the non-constitution of the Appellate Tribunal? (Question of law) 2. Whether the petitioner can be deprived of the benefit of stay of recovery due to the respondents' failure to constitute the Tribunal? (Question of law) Petitioner's Arguments: The petitioner argued that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay of recovery due to the non-constitution of the Tribunal by the respondents. They contended that they should not suffer due to the inaction of the authorities. Revenue's Arguments: The judgment records that the respondent State authorities acknowledged the fact of non-constitution of the Tribunal and issued a notification to address the difficulties arising from it. No specific arguments from the revenue are detailed in the judgment regarding the petitioner's entitlement to the stay.