M/S Sandeep Traders vs The State Of Bihar
2023 Latest Caselaw 110 Patna

         IN THE HIGH COURT OF JUDICATURE AT PATNA
                    Civil Writ Jurisdiction Case No.17286 of 2022
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M/S Sandeep Traders (a Sole Proprietor ship Firm), having its registered office at Near Khushwaha Dharmsala, Anaith, District Aarah, Bhojpur, Bihar through its Sole Properitor Dhananjay Kumar Verma. Aged about 40 years.

... ... Petitioner/s Versus

1. The State of Bihar through Commissioner of State Tax, New Secretariat, Patna.

2. Joint Commissioner of State Tax, Sahabad Circle, Araha, Bihar.

3. Assistant Commissioner of State Tax, Sahabad Circle, Aaraha, Bihar.

... ... Respondent/s ====================================================== Appearance :

For the Petitioner/s : Mr.Anurag Saurav, Advocate For the Respondent/s : Mr.Vivek Prasad (GP7) ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE PARTHA SARTHY ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE)

Date : 09-01-2023

Heard learned counsel for the parties.

Petitioner has prayed for the following relief(s):-

(i) For issuance of an appropriate writ/order/direction for setting aside order bearing reference no. ZD1005220088470 dated 25.05.2022 passed by Joint Commissioner of State Tax Jurisdiction, Sahabad Circle, Aarah, Bihar, whereby and where under respondent rejected the Input Tax Credit Claim of the petitioner against the purchase made by the Petitioner after payment of tax amount and issuance of Tax Invoice from "JVL AGRO INDUSTRIES LIMITED" on the ground that "JVL AGRO INDUSTRIES LIMITED" had not furnished monthly return in Form of GSTR-3R from July 2017 to March 2017 (Financial Year 2017-18) and it has been alleged in Assessment order that the petitioner had taken Input Tax credit to Patna High Court CWJC No.17286 of 2022 dt.09-01-2023

meet the demand in violation of provision of section 16(2)(c) of BGST Act.

(ii) For setting aside order dated 25.05.2022 passed by Joint Commissioner of State Tax Jurisdiction, Sahabad Circle, Aarah has rejected the input tax credit of the petitioner and imposed the tax including tax and penalty amounting of Rs. 8,43,770/- on the petitioner under section 73(9) of BGST Act and a direction was issued to raised demand in the Form of GST DRC 07.

(iii) For setting aside the demand notice isued in the Form of DRC 07 bearing Reference No. ZD1005220088470 dated 25.05.2022, whereby and where under an amount of Rs. 8,43770/- has been imposed as Tax, Interest and Penalty.

(iv) For setting aside Order dated 07.11.2022 issued by respondent no.3 whereby and where under a direction was made to issue Form DRC-13 for attachment of Bank Account of the Petitioner.

(v) For setting aside DRC-13 issued by Assistant Commissioner of State Tax, Sahabad Circle, Aaraha vide Reference Recovery No. 318 Dated 07.11.2022 to Punjab National Bank, Station Road, Ara to attached the Bank Account of the Petitioner and recover an amount of Rs. 13,30,464/-.

(vi) For releasing all of the Bank Account of the petitioner which has been attached by the respondent authorities.

(vii) For issuance of an appropriate Writ(s), order(s), and/or direction(s), as Your Lordships may deem fit and proper in the facts and circumstances of this case in the interest of justice.

It is brought to our notice that vide impugned order

dated 25.05.2022, passed by the Respondent No. 2, namely, the

Joint Commissioner of State Tax, Sahabad Circle, Araha, Bihar

(Ref. No.ZD1005220088470) and demand notice in Form GST

DRC-07 dated 25.05.2022 (Ref. No. ZD1005220088470), for the Patna High Court CWJC No.17286 of 2022 dt.09-01-2023

period July, 2017 to March, 2018, a demand of Rs.8,43,770/- has

been raised. The petitioner has also prayed for quashing of the order

dated 07.11.2022, passed by respondent No.3, namely, the Assistant

Commissioner of State Tax, Sahabad Circle, Aaraha, Bihar issued

in Form DRC-13 whereby bank account of the petitioner has been

attached.

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, the case shall be decided on merits.

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, 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 reasons sufficient even decipherable from the record, as

to how the officer could determine the amount due and payable by Patna High Court CWJC No.17286 of 2022 dt.09-01-2023

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 dated

25.05.2022, passed by the Respondent No. 2, namely, the

Joint Commissioner of State Tax, Sahabad Circle, Araha,

Bihar (Ref. No.ZD1005220088470), demand notice in

Form GST DRC-07 dated 25.05.2022 (Ref. No.

ZD1005220088470), for the period July, 2017 to March,

2018 and the order dated 07.11.2022, passed by respondent

No.3, namely, the Assistant Commissioner of State Tax,

Sahabad Circle, Aaraha, Bihar;

(b) The petitioner undertakes to deposit 20% of the

amount of the demand raised before the Assessing

Officer. This shall be done within four weeks;

c) 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 had

already deposited up to the extent of twenty percent, the

same shall be set off against the amount to be deposited.

Patna High Court CWJC No.17286 of 2022 dt.09-01-2023

Also, if the deposit is found to be in excess, the same

shall be refunded within two months from the date of

passing of the order;

(d) 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;

(e) Petitioner undertakes to appear before the Assessing

Authority on 23.01.2023 at 10:30 A.M., if possible

through digital mode;

(f) The Assessing Authority shall decide the case on

merits after complying with the principles of natural

justice;

(g) We also find the authorities not to have

adjudicated the matter on the attending facts and

circumstances. All issues of fact and law ought to have

been dealt with, even if the proceedings were to be ex

parte in nature;

(h) Opportunity of hearing shall be afforded to the

parties to place on record all essential documents and

materials, if so required and desired;

(i) During pendency of the assessment, no coercive Patna High Court CWJC No.17286 of 2022 dt.09-01-2023

steps shall be taken against the petitioner;

(j) The Assessing Authority shall pass a fresh order

only after affording adequate opportunity to all

concerned, including the writ petitioner;

(k) Petitioner through learned counsel undertakes to

fully cooperate in such proceedings and not take

unnecessary adjournment;

(l) The Assessing Authority shall decide the case on

merits expeditiously, preferably within a period of two

months from the date of appearance of the petitioner;

(m) The Assessing Authority shall pass a speaking

order assigning reasons, copy whereof shall be supplied

to the parties;

(n) Liberty reserved to the petitioner to challenge the

order before this Court, if required and desired;

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

recourse to such other remedies as are otherwise

available in accordance with law;

(p) 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 reasonable dispatch;

Patna High Court CWJC No.17286 of 2022 dt.09-01-2023

(q) We have not expressed any opinion on merits and

all issues are left open;

(r) If possible proceedings 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)

( Partha Sarthy, J)

ranjan/-

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