M/S Seemanchal Auto Zone vs. The State Of Bihar

Held

The Court quashed and set aside the impugned order dated January 9, 2021, passed by the Additional Commissioner of State Taxes (Appeal), Purnea Division. The appeal was restored to its original file and number. The Court accepted the petitioner's statement that ten percent of the total disputed amount had already been deposited, which is a prerequisite for hearing an appeal. If this deposit was not made, it was to be done before the next date. This deposit was to be without prejudice to the rights and contentions of the parties and subject to the order of the Appellate Authority. The Court directed the de-freezing/de-attaching of the petitioner's bank accounts. The Appellate Authority was directed to condone the delay in filing the appeal and decide the appeal on merits after complying with the principles of natural justice, affording adequate opportunity to all concerned, and passing a speaking order. No coercive steps were to be taken against the petitioner during the pendency of the appeal. The Appellate Authority was to decide the appeal expeditiously, preferably within two months from the petitioner's appearance. The Court explicitly stated that it had not expressed any opinion on the merits of the case, and all issues were left open.

Facts

The petitioner, M/s Seemanchal Auto Zone, challenged an order dated January 9, 2021, passed by the Additional Commissioner of State Taxes (Appeal), Purnea Division, which dismissed their appeal solely on the grounds of delay. The appeal was against orders dated January 20, 2020, and February 22, 2020, passed by the Deputy Commissioner, GST, Purnea, under Section 73 of the GST Act. These orders imposed a tax demand of Rs. 41,68,868/-, interest of Rs. 5,00,264/-, and penalty of Rs. 4,16,886/- for the period April 2018 to March 2019. The petitioner sought to set aside the appellate order and prayed for the remand of their appeal to the appellate authority for a decision on merits, citing COVID-19 pandemic restrictions as the reason for the delay in filing the appeal.

Key Issues

1. Whether the delay in filing the appeal before the Additional Commissioner of State Taxes (Appeal) should be condoned, considering the COVID-19 pandemic and related restrictions, thereby allowing the appeal to be decided on merits? Petitioner's Argument: The petitioner argued that the delay in filing the appeal was attributable to the COVID-19 pandemic lockdown and restrictions, and therefore, the appellate authority ought to have condoned the delay and decided the appeal on its merits. They sought a writ of certiorari to set aside the appellate order that dismissed their appeal on grounds of limitation. Revenue's Argument: The learned counsel for the Revenue stated that they had no objection if the matter was remanded to the Appellate Authority for deciding the appeal afresh, with the condition that the ground of delay would not be taken into account and the appeal would be decided on merits. They also agreed that no coercive steps would be taken against the petitioner during the pendency of the appeal.