M/S Jai Maa Constructions And Consultancy vs. The State Of Bihar

Held

The Court quashed and set aside the impugned order dated August 20, 2022, passed by the Additional Commissioner, State Tax (Appeals). The Court accepted the petitioner's statement that 10% of the total disputed 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 Appellate Authority's final order, with a refund mechanism if the deposit was found to be in excess. The Court directed the de-freezing/de-attaching of the petitioner's bank account(s) immediately. The petitioner was directed to appear before the Appellate Authority on November 2, 2022, at 10:30 AM. The Appellate Authority was directed to condone the delay, decide the appeal on merits after complying with the principles of natural justice, afford an opportunity of hearing, and not take coercive steps against the petitioner during the pendency of the appeal. A fresh order was to be passed only after adequate opportunity to all concerned. The Appellate Authority was to decide the appeal expeditiously, preferably within two months, and pass a speaking order. The Court explicitly stated that it had not expressed any opinion on merits and all issues were left open.

Facts

The petitioner, M/s Jai Maa Constructions and Consultancy, filed a writ petition before the Patna High Court seeking to quash an order dated August 20, 2022, passed by the Additional Commissioner, State Tax (Appeals), Patna, which dismissed their appeal at the admission stage due to delay. They also sought to quash an ex-parte order dated March 10, 2022, passed by the Assistant Commissioner, State Tax, cancelling their GST registration without proper opportunity for reply or hearing. The petitioner argued that the delay in filing the appeal was due to COVID-19 restrictions. The revenue stated it had no objection if the matter was remanded to the Appellate Authority for a fresh decision on merits, without considering the delay, and that no coercive steps would be taken against the petitioner during the pendency of the appeal.

Key Issues

1. Whether the delay in filing the appeal before the Additional Commissioner, State Tax (Appeals) was sufficiently explained, and if so, whether the appeal should be decided on merits? (Section 107 of the CGST Act, 2017, and principles of natural justice). The petitioner argued that the delay was attributable to COVID-19 restrictions and that their appeal should be heard on merits. The revenue conceded to the delay being condoned and the appeal being decided on merits. 2. Whether the cancellation of the petitioner's GST registration by the Assistant Commissioner was valid, given the alleged lack of opportunity for hearing and reply? (Section 29 of the CGST Act, 2017, and principles of natural justice). The petitioner contended that the cancellation was ex-parte and violative of natural justice. The revenue did not explicitly argue on this point but agreed to a remand for a fresh decision on merits.