Shree Balaji Enterprises vs. The State Of Bihar

Facts

The petitioner, Shree Balaji Enterprises, filed a writ petition seeking to avail the statutory remedy of appeal 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 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, which stipulated 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 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. Consequently, the recovery of the balance amount and any steps taken towards it were deemed to be stayed. The Court also held that this relief of stay cannot 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. If the petitioner fails to file an appeal within the period specified after the Tribunal's constitution, the respondents 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, upon depositing 20 percent of the remaining disputed tax amount in addition to any amount already deposited under Section 107(6) of the B.G.S.T. Act? 2. Whether the petitioner can be deprived of the statutory remedy of stay due to the respondents' failure to constitute the Tribunal? Petitioner's arguments: The petitioner contended that they are being deprived of their statutory remedy of appeal and the consequential benefit of stay on recovery due to the non-constitution of the Tribunal by the respondents. They argued that they should not suffer due to the inaction of the authorities and should be granted the stay upon fulfilling the deposit requirements as per 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 issued a notification to address the difficulties arising from it. They did not dispute the petitioner's inability to file an appeal. The judgment does not record specific arguments from the respondents regarding the entitlement to stay, beyond acknowledging the situation.