M/S Pramod Khad Bhandar vs. The Union Of INDIA

Held

The Court held that the impugned order dated March 5, 2020, passed by the Assistant Commissioner of State Taxes, Sasaram Circle, was bad in law on two grounds: (a) violation of the principles of natural justice, as the petitioner was not afforded sufficient time for a fair hearing, and (b) the order was passed ex parte without sufficient reasons to determine the amount due. The Court found that such an order, entailing civil consequences, could be interfered with notwithstanding the statutory remedy. Consequently, the Court quashed and set aside the impugned order and the summary of order. The Court directed the de-attachment of the petitioner's bank accounts. The petitioner was directed to deposit an additional ten percent of the demand raised before the Assessing Officer within four weeks, without prejudice to their rights. The petitioner undertook to appear before the Assessing Officer on July 21, 2021, and the Assessing Officer was directed to pass a fresh order expeditiously after affording adequate opportunity to all concerned. The Court explicitly stated that it had not expressed any opinion on the merits of the case, leaving all issues open.

Facts

The petitioner filed a writ petition before the Patna High Court challenging an order dated March 5, 2020, passed by the Assistant Commissioner of State Taxes, Sasaram Circle. The petitioner also contended that their bank accounts had been attached post the impugned order. The Revenue argued that the petitioner had an alternative remedy of appeal under the Bihar Goods and Services Tax Act, 2017. The petitioner confined their relief to specific prayer clauses, reserving liberty to press others later. The Court noted that the impugned order was passed ex parte and without sufficient reasons, violating principles of natural justice.

Key Issues

1. Whether the impugned order dated March 5, 2020, passed by the Assistant Commissioner of State Taxes, Sasaram Circle, under Section 73 of the State Act, is bad in law due to violation of the principles of natural justice, specifically the lack of a fair opportunity of hearing and insufficient reasons? Petitioner's contention: The petitioner argued that they were not afforded sufficient time to represent their case and that the order was passed ex parte without adequate reasoning, leading to civil consequences. They relied on the principle of natural justice. Revenue's contention: The Revenue contended that the petitioner had an equally alternative and efficacious remedy of filing an appeal under the Bihar Goods and Services Tax Act, 2017.