Aadhar Stumbh Township Private Limited vs. The State Of Bihar

Facts

The petitioner, Aadhar Stumbh Township Private Limited, filed a writ petition challenging an order dated 01.03.2021 passed by the Additional Commissioner of State Tax (Appeal), Patna West Division. This order rejected the petitioner's appeal against an order dated 07.03.2020 and a related communication dated 08.03.2020, issued by the Deputy Commissioner of State Tax, Patna South, under Section 74 of the Bihar Goods and Service Tax Act, 2017, concerning the period of April 2019. The petitioner contended that the appellate order was non-speaking, lacked proper hearing, and was passed ex parte. The petitioner also sought directions for the return of pre-deposit amounts and to prevent coercive action against its bank account. The revenue stated it had no objection if the matter was remanded.

Held

The Court held that the order passed by the Additional Commissioner of State Tax (Appeal) dated 01.03.2021 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, as insufficient time was afforded to the petitioner to represent their case; and (b) the ex parte order did not provide sufficient reasons for determining the amount due and payable by the assessee. The Court found that such an order, entailing civil consequences, was liable to be quashed on these grounds alone. Consequently, the Court quashed and set aside the impugned order of the Appellate Authority and the original orders passed by the Deputy Commissioner. 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. The Court also ordered the de-freezing of the petitioner's bank account(s) and directed that no coercive steps be taken against the petitioner during the pendency of the appeal. The Appellate Authority was directed to decide the appeal expeditiously, preferably within two months. The Court explicitly stated that it had not expressed any opinion on the merits of the case and all issues were left open.

Key Issues

1. Whether the order passed by the Additional Commissioner of State Tax (Appeal) on 01.03.2021, rejecting the petitioner's appeal, is a non-speaking order and violates the principles of natural justice, specifically the right to a fair opportunity of hearing, as contemplated under the relevant provisions of the Bihar Goods and Service Tax Act, 2017? Petitioner's arguments: The petitioner argued that the appellate order was non-speaking, meaning it did not provide adequate reasons for its decision. They further contended that they were not afforded sufficient time to present their case, leading to a violation of the principles of natural justice. The petitioner also highlighted that the order was passed ex parte and lacked discernible reasons for determining the amount due. They relied on the Supreme Court's directions in RE: COGNIZANCE FOR EXTENSION OF LIMITATION, SUO MOTU WRIT PETITION (CIVIL) No. 3 of 2020 for extension of time due to COVID-19 restrictions. 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. They agreed that the ground of delay should not be taken into account and the appeal should be decided on merits, with no coercive steps taken against the petitioner during the pendency of the appeal.