M/S Bansal Traders vs. The State Of Bihar

Held

The Court held that it was not precluded from interfering with the order, notwithstanding the statutory remedy, if the order was ex facie bad in law. Two primary reasons were cited: (a) violation of the principles of natural justice, as the petitioner was not afforded sufficient time to present their case, and (b) the ex parte assessment order lacked sufficient reasoning to determine the amount due. The Court found that such an order, passed in violation of natural justice, entails civil consequences. Consequently, the impugned order dated February 26, 2020, the summary of order in Form GST DRC-07, and the appellate order dated March 4, 2021, were quashed and set aside. The Court directed the de-freezing of the petitioner's bank accounts. The petitioner undertook to deposit an additional ten percent of the demand within four weeks, without prejudice to the rights of the parties. The petitioner was directed to appear before the Assessing Officer on July 26, 2021, for a fresh assessment, with the officer to pass a new order expeditiously after affording adequate opportunity to all concerned. All other issues were left open.

Facts

The petitioner filed a writ petition challenging an order dated February 26, 2020, passed by the Joint Commissioner of State Taxes, Munger Circle, under Section 74 of the Bihar Goods and Services Tax Act, 2017, and a summary of order in Form GST DRC-07. The petitioner's bank accounts were attached post this order. An appeal filed against the order was rejected by the Additional Commissioner of State Taxes (Appeals) on March 4, 2021, solely on the ground of delay. The Revenue opposed the writ petition, citing the availability of an alternative efficacious remedy.

Key Issues

1. Whether the High Court should entertain the writ petition despite the availability of an alternative statutory remedy, considering alleged violations of natural justice and the ex-parte nature of the assessment order? (Mixed question of law and fact, concerning principles of natural justice and the scope of writ jurisdiction). Petitioner's Contentions: The petitioner argued that the order was bad in law due to violations of the principles of natural justice, specifically a lack of sufficient opportunity for hearing, and that the assessment order was passed ex parte without sufficient reasoning. The petitioner also noted that 10% of the disputed amount, a prerequisite for appeal hearing, had already been deposited. Revenue's Contentions: The Revenue vehemently opposed the writ petition on the ground that an equally alternative efficacious remedy was available to the petitioner.