Kavita Singh vs. The State Of Bihar

Facts

The petitioner, Kavita Singh, through her authorized representative, approached the Patna High Court seeking to quash an ex parte order dated 17.11.2021 passed by the Assistant Commissioner of State Taxes, Munger Circle. This order, along with a Summary of Order in Form GST DRC-07, was issued by Respondent No. 2. The petitioner contended that the order was passed in violation of the principles of natural justice, as she was not afforded sufficient time or a fair opportunity to present her case. The Revenue, represented by learned counsel, had no objection to the matter being remanded to the Assessing Authority for a fresh decision on merits, with no coercive steps to be taken against the petitioner during the pendency of the case.

Held

The Court held that the impugned order dated 17.11.2021, passed by the Assistant Commissioner of State Taxes, Munger Circle, was bad in law for two primary reasons: (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 her case; and (b) the order being ex parte and lacking sufficient decipherable reasons for determining the amount due. The Court found that the authorities had not adjudicated the matter on the attending facts and circumstances, and all issues of fact and law ought to have been dealt with. Consequently, the Court quashed and set aside the impugned order and the Summary of Order in Form GST DRC-07. The Court directed the petitioner to deposit twenty percent of the demand raised within four weeks, without prejudice to the parties' rights. It also ordered the de-freezing of the petitioner's bank accounts and directed the Assessing Authority to decide the case on merits after complying with the principles of natural justice, affording adequate opportunity to all concerned, and passing a speaking order within two months of the petitioner's appearance. No opinion was expressed on the merits of the case.

Key Issues

1. Whether the order dated 17.11.2021 passed by the Assistant Commissioner of State Taxes, Munger Circle, is bad in law due to violation of the principles of natural justice, specifically the right to a fair opportunity of hearing, as argued by the petitioner? 2. Whether the ex parte order, which allegedly does not provide sufficient reasons for determining the amount due, is liable to be quashed, as contended by the petitioner? Petitioner's Arguments: The petitioner argued that the impugned order was ex parte and passed in violation of the principles of natural justice, as she was not given adequate time to represent her case. She further contended that the order lacked sufficient reasoning to justify the determined tax liability. 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. It also agreed that no coercive steps should be taken against the petitioner during the pendency of the case.