Balraj Kumar vs. The State Of Bihar

Held

The Court noted that the petitioner had invoked Section 128(A) of the BGST Act and remitted the tax due. As a result of this payment, the petitioner was exempted from paying interest and damages. An order to this effect was passed on July 14, 2025. In light of this development, the Court found that the present writ petition no longer survived for consideration. The Court did not explicitly rule on the merits of the petitioner's claim regarding the reversal of ITC within the statutory period, as the issue became moot due to the subsequent payment and exemption from interest and damages.

Facts

The petitioner, Balraj Kumar, proprietor of M/s Mobile Mafia Limited, filed a writ petition challenging a demand notice dated September 26, 2023, issued by the Joint Commissioner of State Tax, Patna City West Circle. The demand of Rs. 36,89,673/- was raised on the alleged ground of non-reversal of Input Tax Credit (ITC). The petitioner contended that the ITC was reversed within the prescribed statutory time frame. The demand notice, also referred to as an order under Section 73, was issued by the Assistant Commissioner of State Tax, directing payment of the outstanding dues, failing which recovery proceedings would be initiated. The petitioner had initially failed to pay the tax, interest, and damages within the stipulated time.

Key Issues

1. Whether the demand notice dated September 26, 2023, for Rs. 36,89,673/- raised by the Joint Commissioner of State Tax on the ground of non-reversal of Input Tax Credit (ITC) is arbitrary and erroneous, considering the petitioner's claim of having reversed the ITC within the statutory period as per GST law? 2. Whether the petitioner is liable to pay interest and damages in light of Section 128(A) of the BGST Act, if the tax due is paid within the stipulated time frame under that section? Petitioner's arguments: The petitioner argued that the demand notice was arbitrary and erroneous because the ITC had been reversed within the prescribed time. The petitioner also invoked Section 128(A) of the BGST Act, which provides for a cut-off date for payment of demand tax, exempting the assessee from paying interest and damages if the tax is paid within that time limit. Revenue's arguments: The judgment does not record any specific arguments from the respondent State.