M/S Kwality Traders, Vs the Commissioner Commercial Tax

NAFR

HIGH COURT OF CHHATTISGARH, BILASPUR

WPT No. 19 of 2024

M/s Kwality Traders, Through its Proprietor Mahesh Kumar Pamnani Address Shubham Complex, Near Pratap Cinema, Gondpara Road, Bilaspur (C.G.) 495001

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---- Petitioner

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Versus

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The Commissioner Commercial Tax GST Department, Government of Chhattisgarh North Block, Sector 19, Atal Nagar

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The Additional Commissioner (Appeal) State Tax Chhattisgarh, (SGST), Commercial Tax -GST Bhavan, North Block, Sector 19 Atal Nagar, Naya Raipur Chhattisgarh.

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The Joint Commissioner of State Tax Bilaspur Division-I, Chhattisgarh

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The Assistant Commissioner of State Tax Bilaspur- 2, Chhattisgarh

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---- Respondents

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(Cause title taken from CIS System)

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For Petitioner : Mr. Shalvik Tiwari, Advocate For State/Respondents : Mr. Gary Mukhopadhyay, G.A.

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Hon'ble Shri Justice Ravindra Kumar Agrawal Judgment on board

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11.07.2024

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This writ petition has been filed challenging the order passed by Additional Commissioner (Appeal) (SGST) State Tax Atal Nagar, Raipur, CG in an appeal under Section 107 of Chhattisgarh Goods and Service Tax Act, 2017 (for short Act of 2017).

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The petitioner by way of this petition has prayed for the following reliefs:-

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I. The Hon’ble Court may call for records from the respondents.

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ii. The Hon’ble Court may set aside the order dated 07.10.2022 passed by the respondent No. 2, annexure P-2 herein.

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iii. The Hon’ble Court may direct the respondents to restore the GST registration of the petitioner.

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iv. The Hon’ble Court may grant any other relief as this Hon’ble Court may deem fit and proper in the nature and circumstances of the present case in the interest of justice.

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The facts of the case leading to final adjudication of this petition is that a demand order was passed on 22.06.2020 by respondent No. 3 imposing tax, interest and penalty for the assessment period from 01.04.2019 to 30.09.2019. Against that order, statutory first appeal as provided under Section 107(1) of the Act of 2017 has been filed before the First Appellate Authority i.e. Additional Commissioner (Appeal) (SGST) State Tax. The First Appellate Authority vide its order dated 07.10.2022 dismissed the appeal of the petitioner.

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As per the scheme of Act of 2017, second appeal is provided before the Goods and Service Tax Appellate Tribunal. It is stated at the Bar that though the Tribunal has been notified in the State of Chhattisgarh, the president or the members have not yet been appointed and therefore, this writ petition seeking the relief as stated above has been filed.

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Learned counsel for the petitioner submits that he has deposited 20 % of the statutory amount which is required before filing the appeal.

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Learned counsel for the parties submit that the similar issues had arisen before the various Hon’ble High Courts which have been

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disposed of with certain directions to file an appeal as and when the appointment of president takes place. He relied upon the judgment of Hon’ble Patna High Court passed in Civil Writ Jurisdiction Case No. 15438 of 2023, M/s Cohesive Infrastructure Developers Pvt. Ltd. Vs. The Central Board of Indirect Taxes and others and order passed by the Hon’ble Bombay High Court in Writ Petition No. 10883 of 2019, Rochem India Pvt. Ltd. Vs. The Union of India and others and connected matters dated 08.02.2023.

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It has been further stated that the State Government vide its notification dated 05.12.2019 has extended the period of limitation as provided under the Act of 2017 from the date of communication of order or the date on which the president or the state president, as the case may be, of the appellate tribunal after its constitution under Section 109, enters office. Therefore, the parties submit that in light of the facts and circumstances and judgments of the Hon’ble Patna and Bombay High Courts, this petition may be disposed of permitting the petitioner to file an appeal as and when the president or the state president as the case may be enters office of the appellate tribunal constituted under Section 109 of the Act of 2017. This preposition has not been disputed by any of the parties appearing in the writ petition. The Hon’ble Patna High Court in case of M/s Cohesive Infrastructure Developers Pvt. Ltd. disposed of the identical cases giving the following directions:-

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(i) 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.

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The recovery of balance amount, and any steps that may have been taken in this regard will thus be deemed to be stayed. It is not in dispute that similar relief has been granted by this Court in the case of SAJ Food Products Pvt. Ltd. vs. The State of Bihar & Others in C.W.J.C. No. 15465 of 2022.

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(ii) The statutory relief of stay, on deposit of the statutory amount, however 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.

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(iii) 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 Patna High Court CWJC No.15438 of 2023 dt.30-10-2023 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.

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(iv) If the above order is complied with and a sum equivalent to 20 per cent of the remaining amount of the tax in dispute is paid then, if there is any attachment of the bank account of the petitioner pursuant to the demand, the same shall be released.

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In the light of the above, this writ petition is disposed of with a direction that the appellant shall file the appeal before the appellate tribunal within 30 days from today and as soon as the president or state president enters office of the Goods and Service Tax Appellate Tribunal constituted under the Act of 2017, appeal that may be decided in accordance with law on its own merits. The statutory stay as provided under Section 112(9) of Act of 2017 would remain in operation till the decision of such appeal. If the appeal is not filed within the prescribed period of limitation, the state would be at liberty

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to proceed against the petitioner for recovery of remaining taxes,

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interest and penalty if any.

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With these observations, writ petition disposed of.

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Sd/-

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(Ravindra Kumar Agrawal) JUDGE

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Amit Patel

M/S Kwality Traders, v. the Commissioner Commercial Tax

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M/S Kwality Traders, v. the Commissioner Commercial Tax

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