M/S S.R. Brothers vs. Commissioner Of State Tax

Held

The Court quashed and set aside the impugned order dated March 3, 2020, passed by the Additional Commissioner of State Tax (Appeal). The Court accepted the petitioner's statement that ten percent of the total amount, a prerequisite for hearing the appeal, had been deposited. If not deposited, it was to be done before the next date. This deposit was to be without prejudice to the parties' rights and subject to the Assessing Officer's order, with a refund provision if the deposit was found to be in excess. The Court directed the de-freezing/de-attaching of the petitioner's bank accounts. The Appellate Authority was directed to condone the delay in filing the appeal and decide it on merits after complying with the principles of natural justice, affording adequate opportunity to all concerned. Coercive steps were prohibited during the pendency of the appeal. The Appellate Authority was to pass a speaking order expeditiously, preferably within two months from the petitioner's appearance. The Court explicitly stated that no opinion was expressed on the merits of the case, and all issues were left open. The ratio decidendi is that in exceptional circumstances like the COVID-19 pandemic, appellate authorities should be liberal in condoning delays, especially when the revenue does not object to a decision on merits.

Facts

The petitioner filed a writ petition challenging an order dated March 3, 2020, passed by the Additional Commissioner of State Tax (Appeal), Magadh Division, Gaya. This order rejected the petitioner's appeal against an order dated October 1, 2018, passed by the Joint Commissioner of State Tax, Investigation Bureau, Bihar, Patna. The appeal was rejected solely on the grounds of being barred by limitation. The original order by the Joint Commissioner was passed under Sections 122(1), 50, 73(11), and 35(2) of the Bihar Goods and Services Tax Act, 2017, for the period 2018-19. The petitioner contended that the delay in filing the appeal was sufficiently explained due to COVID-19 restrictions.

Key Issues

1. Whether the delay in filing the appeal before the Appellate Authority was sufficiently explained due to COVID-19 restrictions, and if so, whether the Appellate Authority erred in rejecting the appeal on grounds of limitation, thereby violating principles of natural justice? (Question of law and fact, turning on the interpretation of limitation provisions and the impact of COVID-19). Petitioner's Contention: The delay in filing the appeal was adequately explained by the prevailing COVID-19 restrictions, and the Appellate Authority's rejection of the appeal on this ground was erroneous. The petitioner likely argued for condonation of delay based on these circumstances. Revenue's Contention: The Revenue's counsel stated they had no objection if the matter was remanded to the Appellate Authority for a fresh decision on merits, without taking the ground of delay into account. They also agreed that no coercive steps should be taken against the petitioner during the pendency of the appeal.