M/S Arun Kumar Tiwari vs. The State Of Bihar

Facts

The petitioner, M/s Arun Kumar Tiwari, sought to avail the statutory remedy of appeal before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax Act (B.G.S.T. Act). However, the non-constitution of the Tribunal prevented the petitioner from filing the appeal and availing the benefit of stay of recovery of the balance tax amount, as provided 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 an order 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. The petitioner approached the High Court under Article 226 of the Constitution of India.

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 non-constitution of the Tribunal by the respondents. The recovery of the balance amount and any steps taken in this regard were deemed to be stayed. However, the Court also held that this relief could not be open-ended. To balance equities, 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 functional. If the petitioner fails to file the appeal within the period specified upon the Tribunal's constitution, the respondents would be at liberty to proceed in accordance with law. The Court explicitly 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, considering the respondents' role in the delay of its constitution? Petitioner's contention: The petitioner argued that they should not be deprived of the statutory remedy of stay due to the respondents' failure to constitute the Tribunal. They relied on the fact that similar relief had been granted by the High Court in other cases. They also pointed to the respondents' own notification acknowledging the issue. 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 removal of difficulties, which stipulated that the limitation period for appeal would commence after the Tribunal's constitution. They did not appear to contest the petitioner's right to a stay, but rather focused on the procedural aspects of how the stay would operate.