M/S Shubhankar Om Deo Construction PVT LTD. vs. The State Of Bihar
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The petitioner, M/s Shubhankar Om Deo Construction Pvt Ltd., is a company engaged in works contract and is a registered service provider. The petitioner received a demand notice for Rs. 4,50,506.00 for failure to deposit taxes during the Covid-19 period. The petitioner admits the demand and states it has been trying to deposit the taxes along with interest/penalty/charges but faced inaction. The petitioner filed a representation on October 17, 2024, expressing readiness to file returns and deposit tax liabilities, including any applicable penalty or interest. The State's counter-affidavit clarified that Circular No. 238/32/2024 dated October 15, 2024, is not applicable as it pertains to waiver of interest and penalty for 2017-18, 2018-19, and 2019-20, while the petitioner's demand is for 2021-22. The counter-affidavit also noted that the petitioner is seeking to review a previous court order upholding the cancellation of its registration.
Held
The Court held that Circular No. 238/32/2024 dated October 15, 2024, is not applicable to the petitioner's case. This is because the circular deals with the waiver of interest and penalty for the financial years 2017-18, 2018-19, and 2019-20, whereas the demand raised against the petitioner pertains to the financial year 2021-22. The Court also noted that the petitioner's writ application appeared to be an attempt to review a previous order dated July 8, 2024, in CWJC No. 10212 of 2024, which had upheld the cancellation of the petitioner's registration. Since the revenue's stand regarding the non-applicability of the circular was not contested by the petitioner filing a rejoinder, the Court found that the issues could be resolved by allowing the petitioner to discharge its tax liability. The Court directed that if the petitioner is willing to deposit the amount with the Department, the Department shall accept the same towards the discharge of the petitioner's liability.
Key Issues
1. Whether Circular No. 238/32/2024 dated October 15, 2024, is applicable to the petitioner's case for accepting tax dues along with interest/penalty/charges? The petitioner argued for its applicability, seeking a direction to accept all taxes and dues as per the circular. The revenue contended that the circular is not relevant as it pertains to waiver of interest and penalty for different tax periods (2017-18, 2018-19, and 2019-20), whereas the demand against the petitioner is for the period 2021-22. 2. Whether the petitioner can deposit the admitted tax liability along with interest, penalty, and charges? The petitioner expressed readiness to deposit all dues. The revenue stated that if the petitioner is ready to deposit the taxes with all penalties, interest, and charges, there is no hurdle, and the petitioner is obligated to discharge its tax liability in accordance with law. The revenue also pointed out that cancellation of registration does not prevent the petitioner from discharging its liability.
Sections Cited
Section 238/32/2024
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Cause title — parties, addresses and appearances
ORAL ORDER (Per: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD) 5 23-01-2025 Learned counsel for the petitioner and Mr. Vikas Kumar learned SC-11 for the State.
The petitioner in the present writ application is seeking the following relief: I. For a direction to accept all taxes in the light of Circular No. 238/32/2024 GST vide dated 15th October, 2024 II. For a direction to accept all dues of taxes along with interest/penalty/charges if any, as per the demand for 2/4 taxes as on Rs. 4,50,506.00/- as per the demand notice III. Any other relief/reliefs may be granted to the petitioner is entitled in the facts and circumstances of the case.
From the narration of the facts present in the writ petition, the petitioner is a company engaged in works contract. It admits that it is a service provider and the company was registered with Patna Central Circle-2 bearing GISTIN No. 10AAHCS7836CIZM. The petitioner was served with a demand notice of Rs. 4,50,506.00/- as, admittedly, petitioner failed to deposit the taxes during the Covid-19 period. In the writ application, petitioner has not disputed the demand. In para ‘6’ of the writ application, it is stated as under:- “the petitioner is/was running from pillar to post for deposit the taxes along with interest/charges/penalty, if any, but no any action/step has/have been taken in this regard and thus the petitioner has been suffered for the same.”
Learned counsel for the petitioner submits that petitioner has given representation dated 17.10.2024 as contained in AnnexureP/2 series and is ready to file his return and deposit the tax liabilities and it may be accepted with penalty/interest/charges, if any, for which the petitioner is ready to pay.
3/4
Mr. Vikas Kumar, learned counsel for the State submits that if the petitioner is ready to deposit the taxes with all penalty, interest and charges, there is no hurdle in his way. Learned counsel submits that the petitioner is under obligation to discharge its tax liability and nothing prevents it from paying the same in accordance with the provisions under law. It is further pointed out that the cancellation of the registration does not prevent the petitioner from discharging his tax liability and from the statement of tax present in the writ application itself, it would appear that petitioner has discharged its liability partially on 27.02.2024. 6. In paragraph ‘14’ of the counter affidavit, it has been made clear that the Circular No. 238/32/2024 dated 15.10.2024 would not be relevant and applicable in the case of the petitioner. It is stated that the said circular pertains to the waiver of interest and penalty pertaining to the year 2017-18, 2018-19 and 2019-20 whereas the demand raised against the petitioner pertains to the year 2021-22. It is also submitted that by filing the present writ application, the petitioner is, in-fact, seeking appeal/review the order of this Court passed on 08.07.2024 in C.W.J.C. No. 10212 of 2024 whereunder the cancellation of the registration of the petitioner is upheld. The 4/4 stand of the Department as disclosed in paragraph ‘14’ of the counter affidavit has not been contested by filing any rejoinder to the said counter affidavit, therefore, this Court finds that the issues involved in the writ application would be set at rest by simply observing that the petitioner, if willing to discharge its liability is free to deposit the amount with the Department in accordance with law and if the deposits are offered by the petitioner, the Department shall accept the same towards the discharge of the liability of the petitioner.
This writ application stands disposed of Sunnykr/- (Rajeev Ranjan Prasad, J) ( Ramesh Chand Malviya, J) U
Reproduced from the public record of the Patna High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.