2023 (8) TMI 1121 - HC - GST

Petitioner gets statutory stay benefits after depositing 20% disputed tax under Section 112(9) despite Tribunal delays

SAJ Food Products Pvt. Ltd. Versus The State of Bihar through the Secretary cum Commissioner, Department of State Taxes, New Secretariat, Bailey Road, Patna, The Secretary cum Commissioner, Department of State Taxes, New Secretariat, Bailey Road, Patna, The Additional Commissioner of State Taxes (Appeals), Central Division, Patna and The Deputy Commissioner of State Taxes, Special Circle Patna. (2017- 2018)

The Patna HC disposed of a writ petition regarding tax recovery proceedings. The petitioner challenged the maintainability due to non-constitution of the ... Maintainability of petition - availability of alternative remedy of appeal - non-constitution of the Tribunal - prevented from availing the benefit of stay of recovery of balance amount of tax - HELD THAT:- 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. This Court in the case of ANGEL ENGICON PRIVATE LIMITED VERSUS STATE OF BIHAR, ASSISTANT COMMISSIONER OF STATE TAX [2023 (3) TMI 879 - PATNA HIGH COURT] has disposed of the writ petition with certain observations and directions, allowing certain liberty to the petitioner holding that 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. There is an additional fact in the instant case, as asserted by the petitioner, that in terms of the liberty granted under earlier order dated 09.12.2022, in these proceedings, he has already deposited 20 percent of the remaining amount of tax in dispute. Subject to verification of the fact of deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, or deposit of the same, if not already deposited, in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act, 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 non- constitution 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. Petition disposed off. Issues involved:The issues involved in the judgment are the quashing of orders, availability of statutory remedy of appeal, non-constitution of the Tribunal, benefit of stay of recovery of tax, and the liberty granted to the petitioner.Quashing of Orders:The petitioner sought writs to quash orders dated 18.07.2022 and 14.02.2020 passed by the respondents, which rejected the petitioner's appeal and demanded tax, interest, and penalty. The petitioner also requested a declaration regarding the exclusion of damage discount from the value of supply.Availability of Statutory Remedy of Appeal:The petitioner desired to appeal against the impugned order before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax Act. However, due to the non-constitution of the Tribunal, the petitioner was deprived of this statutory remedy and the benefit of stay of recovery of tax.Non-constitution of the Tribunal:The petitioner was prevented from availing the benefit of stay of recovery of tax due to the non-constitution of the Tribunal, as acknowledged by the respondent State authorities. A notification was issued to address the period of limitation for appealing before the Tribunal.Benefit of Stay of Recovery of Tax:The Court granted the petitioner the benefit of stay under Section 112 of the Bihar Goods and Services Tax Act upon depositing a sum equal to 20 percent of the remaining tax amount in dispute. The recovery of the balance amount was stayed due to the non-constitution of the Tribunal.Liberty Granted to the Petitioner:The petitioner was given the liberty to file an appeal under Section 112 of the Act once the Tribunal is constituted and functional. Failure to file an appeal within the specified period would allow the respondent authorities to proceed further in accordance with the law.This judgment addressed the issues of quashing orders, availability of statutory remedy of appeal, non-constitution of the Tribunal, benefit of stay of recovery of tax, and the liberty granted to the petitioner, providing detailed insights into each aspect for a comprehensive understanding.