Amarnath Ray vs. The State Of Bihar

Facts

The petitioner, Amarnath Ray, filed a writ petition before the Patna High Court challenging an order dated April 8, 2021, passed by the Additional Commissioner of State Taxes (Appeals). This appellate order rejected the petitioner's appeal against an order dated December 16, 2020, passed by the Deputy Commissioner of State Taxes. The appeal was rejected solely on the grounds of being barred by limitation. Both the original order and the appellate order were ex parte. The petitioner contended that the delay in filing the appeal was sufficiently explained due to COVID-19 restrictions. The revenue stated it had no objection if the matter was remanded for fresh decision on merits.

Held

The High Court quashed and set aside the impugned order dated April 8, 2021, passed by the Additional Commissioner of State Taxes (Appeals). The Court found that the ex parte orders violated the principles of natural justice due to a lack of fair opportunity of hearing and insufficient reasoning. The Court accepted the petitioner's statement that ten percent of the total amount had been deposited as a prerequisite for hearing the appeal, and directed the petitioner to deposit an additional ten percent of the demand within four weeks, without prejudice to the rights of the parties. The Court also directed 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 of the petitioner's appearance. No coercive steps were to be taken against the petitioner during the pendency of the proceedings. The Court explicitly stated that no opinion was expressed on the merits of the case and all issues were left open.

Key Issues

1. Whether the appeal filed by the petitioner was barred by limitation, considering the prevailing COVID-19 restrictions, and if the delay was sufficiently explained, thereby requiring the appellate authority to decide the appeal on merits? 2. Whether the ex parte orders passed by the Deputy Commissioner and subsequently upheld by the Additional Commissioner of State Taxes violated the principles of natural justice, specifically the right to a fair opportunity of hearing? Petitioner's Arguments: The petitioner argued that the delay in filing the appeal was attributable to COVID-19 restrictions, which prevented them from presenting their case effectively. They also contended that the ex parte orders were passed without sufficient opportunity for hearing and lacked adequate reasoning, leading to civil consequences. Revenue's Arguments: The learned counsel for the Revenue stated that they had no objection to the matter being remanded to the Assessing Authority for a fresh decision on merits.