Aadhar Stumbh Township Private Limited vs. The State Of Bihar

Facts

The petitioner, Aadhar Stumbh Township Private Limited, challenged a non-speaking order dated March 1, 2021, passed by the Additional Commissioner of State Tax (Appeal), Patna, which rejected their appeal. The original order under challenge was passed by the Deputy Commissioner of State Tax on March 7, 2020, and March 8, 2020, for the period of August 2019, under Section 74 of the Bihar Goods and Service Tax Act, 2017. The petitioner sought to quash the appellate order, seeking an opportunity to be heard, and to stay coercive actions by the tax authorities and the bank. The petitioner argued that the delay in filing the appeal was due to COVID-19 restrictions and that the original order was passed without sufficient opportunity of being heard and lacked proper reasoning. The revenue stated it had no objection to the matter being remanded.

Held

The Court quashed and set aside the impugned order dated March 1, 2021, passed by the Additional Commissioner of State Tax (Appeal), and the original orders dated March 7, 2020, and March 8, 2020, passed by the Deputy Commissioner of State Tax under Section 74 of the Bihar Goods and Service Tax Act, 2017. The Court found that the appellate order was bad in law due to the violation of the principles of natural justice, specifically the lack of a fair opportunity of hearing and the non-speaking nature of the order. The Court accepted the petitioner's statement that 10% of the total amount, a prerequisite for hearing the appeal, had already been deposited. The Court directed the Appellate Authority to condone the delay in filing the appeal, decide the appeal on merits after complying with the principles of natural justice, and afford adequate opportunity to all parties. Coercive steps were stayed during the pendency of the appeal. The Court also directed the de-freezing of the petitioner's bank accounts. The Appellate Authority was directed to decide the appeal expeditiously, preferably within two months. 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 appellate authority's rejection of the petitioner's appeal vide order dated March 1, 2021, for non-speaking reasons and without considering the delay caused by COVID-19 restrictions, violates the principles of natural justice, particularly the right to a fair opportunity of hearing, as contemplated under the Bihar Goods and Service Tax Act, 2017? Petitioner's Arguments: The petitioner contended that the appellate order was non-speaking and rejected their appeal without providing a fair opportunity to be heard. They argued that the delay in filing the appeal was sufficiently explained by the COVID-19 pandemic and the Supreme Court's suo motu order extending limitation periods. They also argued that the original order passed by the Deputy Commissioner under Section 74 of the Act was ex parte and lacked sufficient reasoning. Revenue's Arguments: The learned counsel for the revenue stated that they had no objection if the matter was remanded to the Appellate Authority for deciding the appeal afresh, without taking the ground of delay into account and deciding on merits. They also agreed that no coercive steps should be taken against the petitioner during the pendency of the appeal.