Kamlesh Kumar vs. The State Of Bihar

Facts

The petitioner, Kamlesh Kumar, filed a writ petition before the Patna High Court challenging an ex parte order dated March 3, 2021, passed by the Assistant Commissioner State Tax, Saharsa. This order, along with a summary in Form GST DRC-07, was issued in Reference No. ZD1003210007482. The petitioner contended that the order was passed in violation of the principles of natural justice, as they were not afforded a fair opportunity of hearing and insufficient time was given to present their case. The order was also criticized for lacking sufficient reasoning to determine the amount due. The Revenue, represented by the learned counsel for the State, had no objection to the matter being remanded for fresh adjudication on merits, with no coercive steps to be taken against the petitioner during the pendency of the case.

Held

The Court held that the ex parte order dated March 3, 2021, passed by the Assistant Commissioner State Tax, Saharsa, 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, and (b) the order being passed ex parte without assigning sufficient reasons for the determination of the amount due. The Court found that all issues of fact and law ought to have been dealt with, even in ex parte proceedings. Consequently, the Court quashed and set aside the impugned order. The Court directed the petitioner to deposit 20% of the demanded amount within four weeks, without prejudice to the rights of the parties. The bank account of the petitioner was ordered to be de-freezed. The petitioner was directed to appear before the Joint Commissioner of State Tax, Saharsa, on May 16, 2022, who was directed 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. 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 merits and all issues were left open.

Key Issues

1. Whether the ex parte order dated March 3, 2021, passed by the Assistant Commissioner State Tax, Saharsa, is bad in law due to a violation of the principles of natural justice, specifically the right to a fair opportunity of hearing? 2. Whether the ex parte order, which allegedly lacks sufficient reasoning for determining the amount due, is liable to be quashed? Petitioner's Arguments: The petitioner argued that the order was passed ex parte without providing adequate time for them to represent their case, thus violating the principles of natural justice. They also contended that the order did not provide sufficient reasons for the determination of the tax liability. Revenue's Arguments: The Revenue stated that they 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.