Disposed

Sai Enterprises a proprietary concern v. The State of Bihar

Patna HC24 Apr 2023CWJC/1853/2023

Case brief

AI extract

What is this about?

The Patna High Court granted a conditional stay of tax recovery to a petitioner deprived of appellate remedy due to the State's failure to constitute the GST Appellate Tribunal. The court directed a 20% deposit for the stay and mandated filing of appeals once the Tribunal functions.

What did the court decide?

Stay of recovery of balance tax amount conditioned on deposit of 20%; petitioner directed to file appeal once Tribunal is constituted.

Sai Enterprises a proprietary concern Vs The State of Bihar — GST and Indirect Tax | Patna HC (2023)

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IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.1853 of 2023

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Sai Enterprises a proprietary concern having its place of business at Purani Dharmshala Compound, Pan Mandi, Moti Jheel, Muzaffarpur, Bihar - 842001 through its proprietor namely Shashi Kumar male aged about 40 years son of Shatrughan Prasad Singh, resident of Deepak Cement Bhandar, Rewa Road, Bhagwanpur, District - Muzaffarpur, Bihar - 842001.

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... ... Petitioner/s

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Versus

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The State of Bihar through the Commissioner, Department of State Taxes, Government of Bihar, Patna.

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The Additional Commissioner of State Taxes (Appeal), Tirhut Division, Muzaffarpur West, Muzaffarpur.

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The Joint Commissioner of State Taxes, Muzaffarpur West Circle, Muzaffarpur. (February 2019 - March 2019)

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... ... Respondent/s

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====================================================== with Civil Writ Jurisdiction Case No. 2081 of 2023 ====================================================== M/s Ekdari Bharat Gas Gramin Vitrak

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... ... Petitioner/s Versus

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The State of Bihar & Ors.

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... ... Respondent/s

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====================================================== with Civil Writ Jurisdiction Case No. 2082 of 2023 ====================================================== M/s Lakshmi Traders & Ors.

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... ... Petitioner/s Versus

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The State of Bihar & Ors.

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... ... Respondent/s

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====================================================== Appearance : (In Civil Writ Jurisdiction Case No. 1853 of 2023) For the Petitioner/s : Mr.Gautam Kumar Kejriwal, Advocate

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Patna High Court CWJC No.1853 of 2023 dt.24-04-2023 2/5

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For the Respondent/s : Mr.Vivek Prasad, GP-7 (In Civil Writ Jurisdiction Case No. 2081 of 2023) For the Petitioner/s : Mr.Manoj Kumar, Advocate For the Respondent/s : Mr.Vivek Prasad, GP-7 (In Civil Writ Jurisdiction Case No. 2082 of 2023) For the Petitioner/s : Mr.Manoj Kumar, Advocate For the Respondent/s : Mr.Vivek Prasad Mr.Vivek Prasad, GP-7 ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE MADHURESH PRASAD ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE)

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Date : 24-04-2023

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Re.: CWJC No. 2081 of 2023 & CWJC No. 2082 of 2023

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Delink.

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List both these matters after disposal of CWJC No. 9108 of 2021.

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Re.: CWJC No. 1853 of 2023

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The instant writ petition has been filed under Article 226 of the Constitution of India seeking multifarious reliefs.

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The petitioner essentially 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").

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However, due to non-constitution of the Tribunal , the

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Patna High Court CWJC No.1853 of 2023 dt.24-04-2023 3/5

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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.

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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.

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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.

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This Court is, therefore, inclined to dispose of the instant writ petition in the following terms:-

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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

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Patna High Court CWJC No.1853 of 2023 dt.24-04-2023

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4/5

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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. 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 nonconstitution of the Tribunal by the respondentAuthorities, 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 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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With the above liberty, observation and directions, the

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Patna High Court CWJC No.1853 of 2023 dt.24-04-2023 5/5

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writ petition stands disposed of.

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(K. Vinod Chandran, CJ)

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( Madhuresh Prasad, J)

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sujit/-