2023 (11) TMI 247 - HC - GST

Taxpayers Get Relief: Partial Deposit Allows Tax Appeal Stay, Mandates Fair Tribunal Hearing Under Bihar GST Act

M/s Cohesive Infrastructure Developers Pvt. Ltd. Versus The Central Board of Indirect Taxes and Customs, The Commissioner of Central GST and Central Excise Patna -1, The State of Bihar through Secretary cum Commissioner, Additional Commissioner of State Taxes (Appeals), Patna, Deputy Commissioner of State Tax, Patna

HC ruled on a tax appeal case involving non-constitution of the Appellate Tribunal under Bihar GST Act. The court granted stay of tax recovery upon ... Maintainability of petition - availability of statutory remedy of appeal - non-constitution of the Tribunal - 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. Subject to deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, 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. The petitioner cannot be deprived of the benefit, due to non- constitution of the Tribunal by the respondents themselves - Petition disposed off. Issues involved:The petitioner seeks appeal remedy due to non-constitution of the Tribunal under Bihar Goods and Services Tax Act. The respondent State authorities have acknowledged the issue and provided a notification regarding the same.Judgment Details:Issue 1: Appeal remedy due to non-constitution of the TribunalThe petitioner filed a writ petition seeking various reliefs, primarily the appeal remedy against an impugned order before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax Act. However, the non-constitution of the Tribunal has deprived the petitioner of the statutory remedy under Sub-Section (8) and Sub-Section (9) of Section 112 of the Act. The respondent State authorities acknowledged this fact and issued a notification to address the issue, stating that the period of limitation for appealing before the Tribunal shall start only after the Tribunal is constituted. The Court, considering the circumstances, ordered that the petitioner be granted the benefit of stay of recovery of the balance tax amount upon depositing a specified sum. The Court emphasized that the petitioner should not be deprived of this benefit due to the non-constitution of the Tribunal by the respondents themselves.Issue 2: Requirement to file appeal once the Tribunal is constitutedThe Court, while granting the statutory relief of stay, also emphasized that the relief cannot be open-ended. It was decided that once the Tribunal is constituted and functional, the petitioner must file an appeal under Section 112 of the B.G.S.T. Act. The appeal should be filed in accordance with statutory requirements after the Tribunal comes into existence to facilitate its consideration. Failure to file the appeal within the specified period upon the Tribunal's constitution would allow the respondent authorities to proceed further in the matter as per the law.Issue 3: Compliance and release of bank account attachmentIf the petitioner complies with the Court's order, including paying the specified amount, any attachment of the petitioner's bank account pursuant to the tax demand shall be released. With these directions and observations, the writ petition was disposed of by the Court, granting specific reliefs to the petitioner while ensuring compliance with statutory procedures and timelines.