Bijay Kumar Yadav vs. The State Of Bihar

Facts

The petitioner, Bijay Kumar Yadav, filed a writ petition before the Patna High Court challenging an order dated 10.06.2022, passed by the Joint Commissioner of State Taxes, Supaul Circle, and a summary of order issued in Form GST DRC-07. The petitioner sought to quash these orders. The Revenue, through its counsel, stated it had no objection if the matter was remanded to the Assessing Authority for a fresh decision on merits, and that no coercive steps would be taken against the petitioner during the pendency of the case. The Court noted that the impugned order was allegedly bad in law due to a violation of the principles of natural justice, specifically the lack of sufficient time for the petitioner to present their case, and the absence of sufficient reasoning in the order. The tax period in dispute is April 2020-March 2021.

Held

The Court held that the impugned order dated 10.06.2022, passed by the Joint Commissioner of State Taxes, Supaul Circle, and the summary of order in Form GST DRC-07 were bad in law. This decision was based on two primary grounds: (a) violation of the principles of natural justice, specifically the failure to provide the petitioner with a fair opportunity of hearing and sufficient time to represent their case, and (b) the order lacked sufficient, decipherable reasons explaining how the officer determined the amount due and payable by the assessee. The Court emphasized that an order passed in violation of natural justice entails civil consequences. Consequently, the Court quashed and set aside the impugned order. The Court also directed the de-freezing/de-attaching of the petitioner's bank accounts, if attached. The petitioner was directed to deposit twenty percent of the demand raised within four weeks, without prejudice to the rights of the parties. 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 with reasons. The Court explicitly stated that it had not expressed any opinion on the merits of the case, leaving all issues open.

Key Issues

1. Whether the impugned order dated 10.06.2022, passed by the Joint Commissioner of State Taxes, Supaul Circle, and the summary of order in Form GST DRC-07 are liable to be quashed on the grounds of violation of principles of natural justice, specifically the lack of adequate opportunity of hearing to the petitioner? 2. Whether the impugned order is bad in law due to insufficient reasoning provided by the authority for determining the amount due and payable by the assessee? Petitioner's Arguments: The petitioner contended that the order was passed in violation of the principles of natural justice, as they were not afforded sufficient time to represent their case. Furthermore, the order lacked adequate reasoning to justify the demand raised against the petitioner. Revenue's Arguments: The Revenue stated that it had no objection to the matter being remanded to the Assessing Authority for a fresh decision on merits. They also agreed that no coercive steps should be taken against the petitioner during the pendency of the case.