Broad Son Commodities Private ... vs The State Of Bihar
2021 Latest Caselaw 2849 Patna

     IN THE HIGH COURT OF JUDICATURE AT PATNA
               Civil Writ Jurisdiction Case No. 9974 of 2021
======================================================

Broad Son Commodities Private Limited, a Company incorporated under the provisions of the Companies Act, 1956 having its registered office at Dr. Himanshu Complex, Block Road, Koilwar Chouk, P .S. Koilwar, District Bhojpur (Ara), through its Director Ashok Kumar aged about 65 years (male), son of Ram Chandra Saw, resident of Village/Mohalla - Pareo, P.S. Bihta, District Patna ....................... Petitioner. Versus

1. The State of Bihar through the Principal Secretary, Commercial Taxes Department, Government of Bihar.

2. The Principal Secretary cum Commissioner, State Tax, Commercial Taxes Department, Government of Bihar.

3. The Additional Commissioner (Appeal), State Tax, Patna West Division, Patna.

4. The Joint Commissioner of State Tax, Shahabad Circle, Ara.

............... Respondents ====================================================== Appearance :

For the Petitioner/s : Mr. Suraj Samdarshi, Advocate Mr. Piyush Ranjan, Advocate Mr.Rajan Prakash, Advocate Mr. Vijay Shankar Tiwari, Advocate For the Respondent/s : Mr. Vikash Kumar, S.C. 11 ======================================================= CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE S. KUMAR ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE) ===================================================== (The proceedings of the Court are being conducted by Hon'ble the Chief Justice/ Hon'ble Judges through Video Conferencing from their residential offices/residences. Also, the Advocates and the Staffs joined the proceedings through Video Conferencing from their residences/offices.)

Date : 30-06-2021

Petitioner has prayed for the following relief(s):

"i) To issue an appropriate writ, order or direction in the nature of certiorad for quashing order contained in memo no 247 dated 18.03.2021 passed by Respondent Additional Commissioner (Appeal), Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

State Tax in Case no. GST / SH - 49 / 20-21 whereby the well-founded appeal of the petitioner against the adjudication order dated 30.01.2021 contained in Reference no. ZD1001210266842 passed by the Respondent Joint Commissioner of State Tax under section 73 of the CGST /SGST Act 2017 directing the petitioner to deposit Tax of Rs. 9, 70,21,064/-, Interest of 1,60,08,476/- and penalty of Rs. 97,02, 106/ - (Total Rs. 12,27,31,646 /-)has been rejected on wholly erroneous grounds and without considering the case of the petitioner.

ii) To issue an appropriate writ, order or direction in the nature of certiorari for quashing the order dated 30.01.2021 contained in Reference no. ZD1001210266842 passed by the Respondent Joint Commissioner of State Tax under section 73 of the CGST /SGST Act 2017 directing the petitioner to deposit Tax of Rs. 9,70,21,064/-, Interest of 1,60,08,476/- and penalty of Rs. 97,02, 106/ - (Total Rs. 12,27,31,646 /-).

iii) To issue an appropriate writ, order or direction in the nature of certiorari for quashing the show cause contained in Reference no ZD1012200084847 dated 10.12.2020 issued by the Respondent Joint Commissioner of State Tax under section 73 alleging short payment of tax under reserve charge mechanism on the royalty paid to the government.

iv) To issue an appropriate writ, order or direction in the nature of certiorari for quashing letter no. 877 dated 20.03.2021 addressed to the Manager HDFC Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

Bank Patliputra Colony Patna, letter no. 800 dated 20.03.2021 addressed to the Manager, Punjab National Bank, Dehri on Sone, Rohtas and letter no. 801 dated 20.03.2021 addressed to the Manager Punjab National Bank, Bhojpur, all written by the Respondent no. 4 under section 79(1)(c) of the Central Goods and Services Tax 2017 directing them to make payment of Rs. 57,01,20,094/on behalf of the petitioner.

v) During the pendency of this writ application the Respondents may be directed not to take any coercive steps against the petitioner for recovery of the disputed tax amount.

vi) This Hon'ble Court may further adjudicate and hold that the services provided by the State of Bihar to the petitioner by way of grant of mineral concession for winning sand is not leviable with GST in light of the specific exemption granted by Sl no. 64 of notification no 12/2017 dated 28.06.2017.

vii) This Hon'ble Court may further adjudicate and hold that the show cause dated 10.12.2020, the adjudication order dated 30.01.2021 and the appellate order contained in memo no. 247 dated 18.03.2021 having been issued without any DIN ·are in contravention of circular no 122 /41 / 2019 / GST dated 05/11/2019 and are therefore bad in law.

viii) This Hon'ble Court may further adjudicate and hold that even if GST is leviable on the royalty paid by the petitioner to the state of Bihar, then the advance ruling dated 29.09.2020 classifying the Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

same under residual entry of sl. no 17 of Notification no 11 /2017, is binding on the department.

ix) This Hon'ble Court may further adjudicate and hold that the show cause dated 10.12.2020, adjudication order dated 30.01.2021 and the appellate order dated 18.03.2021 classifying the services under Sl no. 29 Heading 9991 of Notification no 11 /2017 is bad in law as the same is contrary to the advance ruling dated 29.09.2020 classifying the same under residual entry of sl no 17 of Notification no 11 /2017.

x) This Hon'ble Court may further adjudicate and hold that the adjudication order is bad is law inasmuch as no reasons have been given for confirming the disputed tax and also that the petitioner has not been granted adequate opportunity to present its case.

xi) This Hon'ble Court may further adjudicate and hold that the order of appellate authority dated 18.03.2021 is bad in law inasmuch as the same has been passed in a mechanical manner without any application of mind and without dealing with the grounds raised by the petitioner.

xii) To grant any other relief or reliefs which the Petitioner may be found entitled to in the facts and circumstances of the case."

It is brought to our notice that vide impugned order

18th of March, 2021 passed by Respondent No. 3 namely Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

The Additional Commissioner (Appeal), State Tax, Patna

West Division, Patna in Appeal Case No. GST/SH-49/20-

21 (Annexure-9), appeal preferred by the petitioner against

the order dated 30th of January, 2021 (Annexure-8) passed

by the Respondent No. 4 namely The Joint Commissioner

of State Tax, Shahabad Circle, Ara vide Reference No.

ZD1001210266842 and Summary of order dated 30 th of

January, 2021, stands dismissed. Both the orders were ex

parte in nature.

Learned counsel for the Revenue, states that he has

no objection if the matter is remanded to the Assessing

Authority for deciding the case afresh. Also, during

pendency of the case, no coercive steps shall be taken

against the petitioner.

Statement accepted and taken on record.

However, having heard learned counsel for the parties

as also perused the record made available, we are of the

considered view that this Court, notwithstanding the statutory

remedy, is not precluded from interfering where, ex facie, we

form an opinion that the order is bad in law. This we say so,

for two reasons- (a) violation of principles of natural justice, Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

i.e. Fair opportunity of hearing. No sufficient time was

afforded to the petitioner to represent his case; (b) order passed

ex parte in nature, does not assign any sufficient reasons even

decipherable from the record, as to how the officer could

determine the amount due and payable by the assessee. The

order, ex parte in nature, passed in violation of the principles

of natural justice, entails civil consequences. As such, on this

short ground alone, we dispose of the present writ petition in

the following mutually agreeable terms:

(a) We quash and set aside the impugned order 18th of

March, 2021 passed by Respondent No. 3 namely The

Additional Commissioner (Appeal), State Tax, Patna West

Division, Patna in Appeal Case No. GST/SH-49/20-21

(Annexure-9); the order dated 30 th of January, 2021

(Annexure-8) passed by the Respondent No. 4 namely The

Joint Commissioner of State Tax, Shahabad Circle, Ara

vide Reference No. ZD1001210266842 and Summary of

order dated 30th of January, 2021;

(b) We accept the statement of the petitioner that 10

per cent of the total amount, being condition prerequisite for

hearing of the appeal, already stands deposited. If that were

so, well and good. However, if the amount is not deposited Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

for whatever reason(s), same shall be done within a period

of seven days from the date of account being made

operational;

(c) Further the petitioner undertakes to additionally

deposit ten per cent of the amount of the demand raised

before the Assessing Officer. This shall be done within a

period of seven days from the date of account being made

operational.

(d) This deposit shall be without prejudice to the

respective rights and contention of the parties and subject to

the order passed by the Assessing Officer. However, if it is

ultimately found that the petitioner's deposit is in excess,

the same shall be refunded within two months from the date

of passing of the order;

(e) In this view of the matter, we also direct for de-

freezing/de-attaching of the bank account(s) of the writ-

petitioner, if attached in reference to the proceedings, subject

matter of present petition. This shall be done immediately.

(f) Petitioner undertakes to appear before the Assessing

Officer on 9th of August, 2021 at 10:30 A.M., if possible

through digital mode;

(g) Opportunity of hearing shall be afforded to the Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

parties to place on record all essential documents and

materials, if so required and desired;

(h) The Assessing Officer shall pass a fresh order

only after affording adequate opportunity to all concerned,

including the writ petitioner;

(i) Petitioner through learned counsel undertakes to

fully cooperate in such proceedings and not take

unnecessary adjournment;

(j) The Assessing Officer shall decide the matter on

merits expeditiously, preferably within a period of two

months from the date of appearance of the petitioner;

(k) Liberty reserved to the petitioner to challenge

the order, if required and desired;

(l) Equally, liberty reserved to the parties to take

recourse to such other remedies as are otherwise available

in accordance with law;

(m) We are hopeful that as and when petitioner

takes recourse to such remedies, before the appropriate

forum, the same shall be dealt with, in accordance with law,

with a reasonable dispatch;

(n) We have not expressed any opinion on merits

and all issues are left open;

Patna High Court CWJC No. 9974 of 2021 dt. 30-06-2021

(o) If possible, proceedings during the time of

current Pandemic [Covid-19] be conducted through digital

mode;

The instant petition sands disposed of in the

aforesaid terms.

Interlocutory Application(s), if any, also stands

disposed of.

Learned counsel for the respondents undertakes

to communicate the order to the appropriate authority

through electronic mode.

(Sanjay Karol, CJ)

(S. Kumar, J)

Sujit/PKP-

AFR/NAFR
CAV DATE
Uploading Date          06.07.2021
Transmission Date