Shiv Kumar Yadav vs. The State Of Bihar

Facts

The petitioner, Shiv Kumar Yadav, filed a writ petition before the Patna High Court challenging two orders dated 25.10.2021 and 10.01.2021, issued by the Assistant Commissioner of State Taxes, Circle Siwan (Respondent No. 8). These orders demanded a total of Rs. 1,08,881.86 for the period 2020-2021, comprising tax, penalty, and interest. The petitioner contended that he had not received any GST from Surav Siksha Abhiyan, Siwan (Respondent No. 10), and therefore was not liable to pay the demanded GST. The petitioner sought to quash these orders and stay their operation. The orders were described as ex parte.

Held

The Court held that the orders dated 25.10.2021 and 10.01.2021 passed by the Assistant Commissioner of State Taxes, Circle Siwan, were bad in law. The Court found two primary reasons for this: (a) a violation of the principles of natural justice, specifically the lack of a fair opportunity of hearing and insufficient time afforded to the petitioner to present his case; and (b) the orders were passed ex parte without assigning sufficient reasons to justify the determined amount due. The Court emphasized that such ex parte orders, passed in violation of natural justice, entail civil consequences. Consequently, the Court quashed and set aside the impugned orders. The Court also directed the petitioner to deposit 20% of the demanded amount within eight weeks, without prejudice to the rights of the parties, and ordered the de-freezing of the petitioner's bank accounts. The Assessing Authority was directed to decide the case on merits after complying with the principles of natural justice, affording adequate opportunity to all parties, and passing a speaking order within two months from the petitioner's appearance. No coercive steps were to be taken against the petitioner during this period. The Court explicitly stated that it had not expressed any opinion on the merits of the case.

Key Issues

1. Whether the orders dated 25.10.2021 and 10.01.2021 passed by the Assistant Commissioner of State Taxes, Circle Siwan, are bad in law due to violation of the principles of natural justice, specifically the right to a fair opportunity of hearing and the passing of an ex parte order without sufficient reasoning? Petitioner's Contention: The petitioner argued that the orders were passed ex parte and in violation of the principles of natural justice, as he was not afforded sufficient time to represent his case and the orders lacked adequate reasoning for the determined demand. Revenue's Contention: The learned counsel for the Revenue stated that they had no objection if the matter was remanded to the Assessing Authority for deciding the case afresh on merits, and that no coercive steps would be taken against the petitioner during the pendency of the case.