M/S Manoj Kumar vs. The State Of Bihar

Held

The Court quashed and set aside both the appellate order dated April 9, 2021, and the original order dated February 9, 2021. The Court found that the orders were passed in violation of the principles of natural justice, specifically the right to a fair opportunity of hearing, and that the appellate order was ex parte and lacked sufficient reasoning. The Court noted that the petitioner had undertaken to deposit ten percent of the total amount as a prerequisite for hearing the appeal, and further undertook to deposit an additional ten percent of the demand before the Assessing Officer within four weeks. The Court directed the de-freezing of the petitioner's bank accounts. The Assessing Authority was directed to decide the case on merits after complying with the principles of natural justice, affording adequate opportunity to all parties, and passing a speaking order. The Court explicitly stated that it had not expressed any opinion on the merits of the case, and all issues were left open. The proceedings were to be conducted expeditiously, preferably within two months, and if possible, through digital mode due to the pandemic.

Facts

The petitioner, M/s Manoj Kumar, filed a writ petition challenging an order dated April 9, 2021, issued by the Additional Commissioner of State Taxes (Appeal), Purnea Division, rejecting their appeal against an order dated February 9, 2021, passed by the Assistant Commissioner of State Taxes, Saharsa Circle. The original order imposed liability for tax, interest, and penalty under Section 74 of the Bihar Goods and Services Tax Act, 2017. The petitioner contended that the appellate order was cryptic, non-speaking, and in violation of Section 107 of the Bihar Act. They also argued that the Assistant Commissioner failed to act on their application for rectification under Section 161 of the Bihar Act. The impugned orders were alleged to be ex parte and passed without sufficient opportunity for the petitioner to present their case, violating principles of natural justice.

Key Issues

1. Whether the order dated April 9, 2021, passed by the Additional Commissioner of State Taxes (Appeal) is a non-speaking order, in violation of Section 107 of the Bihar Goods and Services Tax Act, 2017? 2. Whether the order dated February 9, 2021, passed by the Assistant Commissioner of State Taxes was passed in violation of the principles of natural justice, specifically the right to a fair opportunity of hearing, and whether it was an ex parte order lacking sufficient reasoning? 3. Whether the silence of the Assistant Commissioner of State Taxes on the petitioner's application for rectification under Section 161 of the Bihar Goods and Services Tax Act, 2017, was unreasonable, arbitrary, and an abdication of duty? Petitioner's arguments: The appellate order was cryptic and non-speaking, failing to comply with Section 107. The original order was passed ex parte without adequate opportunity for hearing and lacked sufficient reasoning. The inaction on the rectification application under Section 161 was arbitrary. Revenue's arguments: The learned counsel for the Revenue had no objection if the matter was remanded to the Assessing Authority for deciding the case afresh on merits. They also agreed that no coercive steps would be taken against the petitioner during the pendency of the case.