2023 (3) TMI 995 - HC - GST

Maintainability of petition - availability of statutory remedy of appeal - non-constitution of the Tribunal - 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 could not be availed - cancellation of GST registration of petitioner - 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. Writ petition disposed off.

Summary

Issues:
Challenge to cancellation of GST registration and imposition of tax, interest, and penalty under Bihar Goods and Service Tax, 2017.

Analysis:

1. Cancellation of GST Registration:
The petitioner sought to quash the order cancelling their GST registration and the subsequent appellate order for revocation. The High Court noted the petitioner's desire to appeal against the impugned order before the Appellate Tribunal under Section 112 of the Bihar Goods and Services Tax Act (B.G.S.T. Act). However, due to the non-constitution of the Tribunal, the petitioner was deprived of this statutory remedy, including the benefit of stay of recovery of the tax amount. The respondent State authorities acknowledged the non-constitution of the Tribunal and issued a notification regarding the period of limitation for preferring an appeal. The Court referred to a previous case where it allowed the petitioner to avail the statutory benefit of stay by making a deposit, emphasizing the need for the petitioner to file an appeal once the Tribunal is constituted.

2. Imposition of Tax, Interest, and Penalty:
The petitioner also challenged the imposition of tax, interest at 18% per annum, and penalty at 100% for specific periods under the Bihar Goods and Service Tax, 2017. The High Court considered the circumstances, including the non-constitution of the Tribunal, and provided certain observations and directions. It directed the petitioner to make a deposit equal to 20% of the remaining tax amount in dispute to avail the statutory benefit of stay. The Court emphasized that the relief of stay on deposit of the statutory amount should not be open-ended and required the petitioner to file an appeal under Section 112 of the B.G.S.T. Act once the Tribunal is constituted. Failure to file an appeal within the specified period would allow the respondent authorities to proceed further in accordance with the law.

3. Overall Disposition:
The High Court disposed of the instant writ petition in line with the previous case, granting the petitioner similar liberty as in the earlier judgment. The Court emphasized the importance of adhering to statutory requirements and timelines once the Tribunal is functional, ensuring that the petitioner's right to appeal is preserved. The judgment highlighted the need for balance in equities and the requirement for the petitioner to take necessary steps in availing the statutory remedy of appeal before the Tribunal to address the issues raised regarding the imposition of tax, interest, and penalty under the B.G.S.T. Act.

By providing these detailed analyses for each issue involved in the judgment, the summary captures the essence of the legal proceedings and the Court's directions in a comprehensive manner.