M/S Baba Bateshwar Construction Private Limited vs. The State Of Bihar

Facts

M/s Baba Bateshwar Construction Private Limited (the petitioner) filed a writ petition seeking to avail the statutory remedy of appeal against an order before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax Act (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 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 amounts. 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 constitution and the President's assumption of 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. The recovery of the balance amount and any steps taken for it would be deemed stayed. However, the Court also opined that this stay cannot be open-ended. Therefore, 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, within a period to be specified. If the petitioner fails to avail this remedy, the respondent authorities would be at liberty to proceed in accordance with law. The Court noted that similar relief was 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, on what conditions? 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 respondents' failure to constitute 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 stipulated in Section 112(8) of the B.G.S.T. Act. Respondent's Arguments: The respondent State authorities acknowledged the non-constitution of the Tribunal and had issued a notification to address the issue of limitation. They did not dispute the petitioner's right to seek relief but were bound by the statutory provisions and the practical difficulties arising from the Tribunal's non-existence.