Sky Vision Media Private Limited vs. The State Of Bihar

Facts

The petitioner, Sky Vision Media Private Limited, challenged an ex-parte order dated February 8, 2021, and a summary of order in Form GST DRC-07, passed by the Assistant Commissioner of State Taxes, North Circle, Patna. This order, issued under Section 73(1) of the Bihar Goods And Services Tax Act, 2017, and Rule 142(5) of the Bihar Goods And Services Tax Rules, 2017, pertained to the tax period 2019-20 and raised a demand of Rs. 34,32,721.00. The petitioner sought quashing of the order, a declaration that it was cryptic, non-speaking, and violative of natural justice, and a restraint on coercive recovery. The revenue, represented by the learned counsel, had no objection to the matter being remanded for fresh decision on merits, with no coercive steps during the pendency.

Held

The Court held that the impugned order dated 08.02.2021, passed by the Assistant Commissioner of State Taxes, North Circle, Patna, was bad in law on two 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, and (b) the order being ex-parte and lacking sufficient reasons to decipher how the officer determined the amount due. The Court found that an ex-parte order passed in violation of natural justice entails civil consequences. Consequently, the Court quashed and set aside the impugned order. The Court also directed the petitioner to deposit ten percent of the demand within four weeks, without prejudice to the rights of the parties. The bank account(s) of the petitioner were to be de-frozen immediately. The Assessing Authority was directed to decide the case on merits after complying with the principles of natural justice, affording parties an opportunity to present documents, and ensuring no coercive steps are taken during the pendency. A fresh speaking order was to be passed expeditiously, preferably within two months from the petitioner's appearance. The Court explicitly stated that it had not expressed any opinion on merits and all issues were left open.

Key Issues

1. Whether the ex-parte order dated 08.02.2021, passed by the Assistant Commissioner of State Taxes, North Circle, Patna, under Section 73(1) of the Bihar Goods And Services Tax Act, 2017, is bad in law due to violation of principles of natural justice and being non-speaking? Petitioner's Arguments: The petitioner contended that the impugned order was ex-parte, cryptic, non-speaking, and violative of the principles of natural justice, specifically the right to a fair opportunity of hearing. They argued that insufficient time was provided to represent their case, and the order failed to provide sufficient reasons for determining the amount due. Revenue's Arguments: The learned counsel for the revenue stated that they had no objection to the matter being remanded to the Assessing Authority for a fresh decision on merits, and that no coercive steps would be taken against the petitioner during the pendency of the case.