Bablu Kumar vs. The State Of Bihar

Facts

The petitioner, Bablu Kumar, filed a writ petition before the Patna High Court challenging two notices. The first notice, dated March 4, 2020, issued by the Assistant Commissioner of State Tax, Kadamkuan Circle, Patna, demanded Rs. 4,99,176/- as tax, interest, and penalty for the financial year 2018-2019. The second notice, dated January 11, 2021, was issued under Section 79 of the Act to the State Bank of India, directing the attachment of the petitioner's bank account for the payment of Rs. 4,83,164/-. The petitioner contended that these notices were issued in violation of the principles of natural justice, as he was not afforded a fair opportunity of hearing and the orders were passed ex parte without sufficient reasoning.

Held

The Court held that the impugned notices were bad in law due to a clear violation of the principles of natural justice. Specifically, the Court found that the petitioner was not afforded a sufficient opportunity of hearing, and the orders were passed ex parte without assigning adequate reasons for determining the amount due. The Court noted that such orders, entailing civil consequences, are unsustainable on these grounds alone. Consequently, the Court quashed and set aside both the notice dated 04.03.2020 and the notice dated 11.01.2021. The Court directed the petitioner to deposit ten percent of the total amount demanded before the next date, and additionally deposit another ten percent of the demand within four weeks, without prejudice to the rights of the parties. The bank account of the petitioner was ordered to be de-frozen. 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 fresh order expeditiously, preferably 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 the merits of the case, leaving all issues open.

Key Issues

1. Whether the notice dated 04.03.2020 for the financial year 2018-2019, demanding Rs. 4,99,176/-, issued by the Assistant Commissioner of State Tax, Kadamkuan Circle, Patna, is bad in law due to violation of the principles of natural justice. 2. Whether the notice dated 11.01.2021, issued under Section 79 of the Act to the State Bank of India for attaching the petitioner's account for Rs. 4,83,164/-, is bad in law due to violation of the principles of natural justice. Petitioner's Arguments: The petitioner argued that the impugned notices were issued in violation of the principles of natural justice, specifically by not affording him a sufficient opportunity of hearing. He also contended that the orders were passed ex parte without adequate reasoning to determine the amount due. Revenue's Arguments: The learned counsel for the Revenue stated that he had no objection if the matter was remanded to the Assessing Authority for a fresh decision on merits. He also agreed that no coercive steps would be taken against the petitioner during the pendency of the case.