M/S Indus Towers Limited vs. The Union Of INDIA

Facts

M/s Indus Towers Limited (the petitioner) 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 (B.G.S.T. Act) before the Appellate Tribunal. However, the Tribunal had not been constituted, preventing the petitioner from filing the appeal and consequently 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. 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, stipulating that the limitation period 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 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 related steps would be deemed stayed. The Court also held that this stay should not be open-ended. To balance equities, 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, observing all statutory requirements. If the petitioner fails to avail this remedy within a specified period after the Tribunal's constitution, the respondent authorities 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 Sub-Section (9) of Section 112 of the B.G.S.T. Act, despite the non-constitution of the Appellate Tribunal, upon depositing 20 percent of the remaining disputed tax amount? - Petitioner's argument: The petitioner contended that they should not be deprived of the statutory benefit of stay due to the respondents' failure to constitute the Tribunal. They relied on the principle that a litigant should not suffer due to administrative inaction. - Revenue/State's argument: The judgment does not record specific arguments from the revenue or state authorities regarding this issue, other than their acknowledgment of the non-constitution of the Tribunal and the issuance of the removal of difficulties order. 2. Whether the stay of recovery should be open-ended, or if there should be a condition for filing the appeal once the Tribunal is constituted? - Petitioner's argument: Not explicitly recorded, but impliedly, they sought the stay to facilitate their appeal. - Revenue/State's argument: Not explicitly recorded.