M/S Mukhiya Jee Ply And Hardware vs. The State Of Bihar

Held

The Court held that it was not precluded from interfering with the impugned order, notwithstanding the availability of a statutory remedy, if the order was ex facie bad in law. The Court found two primary reasons to intervene: (a) 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 justify the determined amount due. The Court quashed and set aside the impugned order dated February 2, 2020, the summary of order in Form GST DRC-07, and the appellate order dated March 3, 2021, on the ground of violation of natural justice. The Court directed the de-freezing of the petitioner's bank accounts, accepted the petitioner's undertaking to deposit an additional 10% of the demand within four weeks, and scheduled the petitioner's appearance before the Assessing Officer on July 26, 2021. The Assessing Officer was directed to pass a fresh order on merits after affording adequate opportunity to all parties, preferably within two months. The Court explicitly stated that it had not expressed any opinion on the merits of the case.

Facts

The petitioner filed a writ petition challenging an order dated February 2, 2020, passed by the Joint Commissioner of State Taxes, Munger Circle, under Section 74 of the Bihar Goods And Service Tax Act, 2017. This order led to the attachment of the petitioner's bank account(s). Subsequently, the petitioner filed an appeal against the summary of order in Form GST DRC-07, also dated February 2, 2020, before the Additional Commissioner of State Taxes (Appeals). This appeal was rejected on March 3, 2021, solely on the grounds of delay. The Revenue opposed the writ petition, citing the availability of an alternative efficacious remedy.

Key Issues

1. Whether the High Court is precluded from interfering with the impugned order despite the availability of an alternative statutory remedy, considering the alleged violations of natural justice and the ex-parte nature of the assessment order? (Mixed question of law and fact, turning on principles of natural justice and procedural fairness under the Bihar Goods And Service Tax Act, 2017). Petitioner's arguments: The petitioner contended that the High Court should entertain the writ petition because the impugned order was bad in law due to violations of the principles of natural justice, specifically the lack of sufficient opportunity for hearing, and because the assessment order was passed ex parte without adequate reasoning. The petitioner also noted that 10% of the disputed amount had already been deposited as a prerequisite for appeal. Revenue's arguments: The Revenue argued that the writ petition should be dismissed on the ground that an equally alternative and efficacious remedy was available to the petitioner.