(Per: HONOURABLE MR. JUSTICE MADHURESH PRASAD)
The instant writ petition has been filed under Article 226 of the Constitution of India seeking following reliefs:-
a) For issuance of writ in the nature of certiorari for quashing of the order dated 15.12.2022 and the summary of demand issued in form GST APL – 04 dated 30.12.2022 passed by the respondent number 2 whereby the appeal preferred by the petitioner under section 107 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the “central act 2017” for short) and the Bihar Goods And Services Tax Act, 2017 (hereinafter referred to as the Bihar act 2017 for short) has been rejected without any application of mind to the facts and materials on record and the audit report dated 03.10.2022 issued vide letter number 170 dated 19.11.2022 by the Additional Commissioner of State Taxes (Audit), Tirhut Division, Muzaffarpur;
b) For further issuance of a writ in the nature of certiorari for quashing of the ex parte order dated 04.12.2021 passed by the respondent number 3 in exercise of powers under section 73 of the central act 2017 and Bihar act 2017 whereby the ability of tax, interest and penalty has been imposed against the petitioner with respect to the financial year 2017- 2018 being in teeth of the subsequent audit report dated 03.10.2022 issued vide letter number 170 dated 19.11.2022 by the Additional Commissioner of State Taxes (Audit), Tirhut Division, Muzaffarpur;
c) For further restraining the respondents from resorting to any mode of coercive recovery of the amount of tax, interest and penalty from the petitioner and its assets in terms of the impugned orders passed by the respondent number 2 and 3 which are contrary to the audit report given by the superior authority of the same GST Department;
d) For further holding and a declaration that the respondents have no jurisdiction to make fanciful addition to the gross turnover admitted by the petitioner in its returns without any material, valid and relevant basis and therefore the impugned orders determining liability of tax, interest and penalty on the basis of such enhancement of gross turnover of the petitioner is absolutely misconceived, without jurisdiction and bad in law;
e) For further holding and a declaration that the petitioner having already discharged output tax liability on the freight charges paid against transport services received could never be held liable to account for GST on the basis of reverse charge mechanism after passage of several months as the petitioner would be deprived of the input tax credit to which the petitioner could be entitled in case the petitioner would discharge such liability in the financial year 2017-2018;
f) For grant of any other relief or reliefs to which the petitioner is found entitled in the facts and circumstances of this case.”
The petitioner is desirous of availing statutory remedy of appeal against the impugned order before the Appellate Tribunal (hereinafter referred to as “Tribunal”) under Section 112 of the Bihar Goods and Services Tax Act (hereinafter referred to as “B.G.S.T. Act”).
However, due to non-constitution of the Tribunal, the petitioner is deprived of his statutory remedy under Sub-Section (8) and Sub-Section (9) of Section 112 of the B.G.S.T. Act.
Under the circumstances, the petitioner is also prevented from availing the benefit of stay of recovery of balance amount of tax in terms of Section 112 (8) and (9) of the B.G.S.T Act upon deposit of the amounts as contemplated under Sub-section (8) of Section 112.
The respondent State authorities have acknowledged the fact of non-constitution of the Tribunal and come out with a notification bearing Order No. 09/2019-State Tax, S.O. 399, dated 11.12.2019 for removal of difficulties, in exercise of powers under Section 172 of the B.G.S.T Act which provides that period of limitation for the purpose of preferring an appeal before the Tribunal under Section 112 shall start only after the date on which the President, or the State President, as the case may be, of the Tribunal after its constitution under Section 109 of the B.G.S.T Act, enters office.
Considering the facts and circumstances noted above, this Court in the case of Angel Engicon Private Limited vs. the State of Bihar & Anr. passed in C.W.J.C No. 1920 of 2023 has disposed of the writ petition with certain observations and directions, allowing certain liberty to the petitioner, which reads as follows:
“If the petitioner makes a deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act, then the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act, for he cannot be deprived of the benefit, due to nonconstitution of the Tribunal by the respondents themselves. The recovery of balance amount, and any steps that may have been taken in this regard will thus be deemed to be stayed.
The statutory relief of stay on deposit of the statutory amount, in the opinion of this Court, cannot be open ended. For balancing the equities, therefore, the Court is of the opinion that since order is being passed due to non-constitution of the Tribunal by the respondent- Authorities, the petitioner would be required to present/file his appeal under Section 112 of the B.G.S.T. Act, once the Tribunal is constituted and made functional and the President or the State President may enter office. The appeal would be required to be filed observing the statutory requirements after coming into existence of the Tribunal, for facilitating consideration of the appeal.
In case the petitioner chooses not to avail the remedy of appeal by filing any appeal under Section 112 of the B.G.S.T. Act before the Tribunal within the period which may be specified upon constitution of the Tribunal, the respondent- Authorities would be at liberty to proceed further in the matter, in accordance with law.
With the above liberty, observation and directions, the writ application stands disposed of.”
The instant writ petition is disposed of in the same terms, allowing the petitioner liberty as has been granted to the petitioner in C.W.J.C. No. 1920 of 2023.