M/S Flipkart INDIA Private Limited vs. The Additional Commissioner Of State Tax (Appeal)

Facts

The petitioner, M/s Flipkart India Private Limited, filed a writ petition before the Patna High Court seeking to avail the statutory remedy of appeal against an impugned order before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax (B.G.S.T.) Act. However, the petitioner was unable to file the appeal due to the non-constitution of the Tribunal. This prevented them from availing the benefit of stay of recovery of the balance amount of tax, as contemplated 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 under Section 172 of the B.G.S.T. Act, stating that the period of limitation for filing an 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 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 steps taken in this regard were deemed to be stayed. The Court also held that this relief cannot be open-ended. 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 made functional. If the petitioner fails to file an appeal within the period specified upon the constitution of the Tribunal, the respondents would be at liberty to proceed in accordance with law. The Court relied on 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, given that the delay is attributable to the respondents? Petitioner's contention: The petitioner argued that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay due to the failure of the respondents to constitute the Tribunal. They contended that they should not be penalized for a delay caused by the authorities and should be granted the stay upon fulfilling the deposit requirements under Section 112(8) of the B.G.S.T. Act. Revenue/State's contention: The respondents 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 issue of limitation. The judgment does not record any specific argument from the respondents against granting the stay, other than their acknowledgment of the situation.