M/S Ankur Enterprises vs. The State Of Bihar

Facts

M/s Ankur Enterprises, a partnership firm, filed a writ petition before the Patna High Court. The petitioner sought 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 Tribunal had not been constituted, preventing the petitioner from filing an 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 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 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 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 towards it were deemed to be stayed. The Court also held that this relief of stay cannot be open-ended. The petitioner would be required to file their appeal under Section 112 once the Tribunal is constituted and made functional. If the petitioner fails to file an appeal within the period specified upon the Tribunal's constitution, the respondents would be at liberty to proceed in accordance with law. This relief was granted in line with a similar order 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, upon what conditions? Petitioner's Contention: 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 failure of the respondents to constitute the Tribunal. They contended that they should not be prejudiced by this administrative inaction and should be granted the stay upon fulfilling the deposit requirements. Revenue's Contention: The respondent State authorities acknowledged the non-constitution of the Tribunal and had issued a notification to address the issue of limitation. Their stance, as reflected in the Court's disposal, implies an acceptance that a remedy needs to be provided in light of the circumstances.