M/S Greenline Services vs. The State Of Bihar

Facts

The petitioner, M/s Greenline Services, challenged two orders: one dated 06.03.2021 passed by the Joint Commissioner of State Taxes (Respondent No. 3) under Section 73 of the Bihar Goods And Services Tax Act, 2017, and another dated 24.09.2021 passed by the Additional Commissioner of State Taxes (Appeals) (Respondent No. 2) rejecting the petitioner's appeal. The petitioner contended that both orders were cryptic, non-speaking, and violative of the principles of natural justice, particularly regarding the opportunity of hearing and the ex-parte nature of the proceedings. The tax period in dispute was 2019-2020. The petitioner sought quashing of these orders and a restraint on coercive recovery.

Held

The Court held that the impugned orders were bad in law on two primary grounds: (a) violation of the principles of natural justice, specifically the lack of a fair opportunity of hearing and insufficient time afforded to the petitioner to present their case; and (b) the orders were passed ex-parte without assigning sufficient reasons decipherable from the record as to how the amount due was determined. The Court found that the authorities had not adjudicated the matter on the attending facts and circumstances, failing to deal with all issues of fact and law. Consequently, the Court quashed and set aside both the order dated 24.09.2021 passed by the Additional Commissioner of State Taxes (Appeals) and the order dated 06.03.2021 passed by the Joint Commissioner of State Taxes. The Court directed the Assessing Authority to decide the case afresh on merits after complying with the principles of natural justice, affording adequate opportunity to all parties, and passing a speaking order. The Court also directed the de-freezing of the petitioner's bank accounts and stipulated that no coercive steps would be taken during the pendency of the fresh proceedings. The Court explicitly stated that it had not expressed any opinion on the merits of the case, leaving all issues open.

Key Issues

1. Whether the order dated 06.03.2021 passed by the Joint Commissioner of State Taxes under Section 73 of the Bihar Act 2017 is unsustainable in law for being cryptic, non-speaking, and violative of the principles of natural justice, specifically the right to a fair opportunity of hearing? 2. Whether the order dated 24.09.2021 passed by the Additional Commissioner of State Taxes (Appeals) is unsustainable in law for being cryptic, non-speaking, and violative of the principles of natural justice? Petitioner's Arguments: The petitioner argued that both impugned orders were highly cryptic, misconceived, non-speaking, and violated the principles of natural justice. They contended that insufficient time was provided for representation and that the orders were passed ex-parte without sufficient reasoning to determine the amount due. The petitioner relied on the principle that orders entailing civil consequences must adhere to natural justice. Revenue's Arguments: The learned counsel for the Revenue stated they had no objection if the matter was remanded to the Assessing Authority for a fresh decision on merits, with no coercive steps taken against the petitioner during the pendency of the case.