Order Preventing Assessee from Availing Benefit of Stay Recovery of Balance GST Amount passed in absence of Tribunal by GST Authorities: Patna HC directs to file Appeal u/s 112 of BGST Act

The Patna High Court (HC) directed to file an appeal under section 112 of the Bihar goods and services tax act 2017 (BGST Act) since the order preventing the assessee from availing the benefit of stay the recovery of balance GST amount passed in absence of Tribunal by GST authorities.

Gammon Engineers and Contractors Pvt. Ltd., the petitioner filed the petition for issuance of a writ like certiorari for quashing of the order dated 02.03.2022 issued vide memo number 112/Patna by the respondent number 2 appellate authority whereby the appeal preferred by the petitioner under section 107 of the central goods and services tax act 2017 (the central act 2017 ) and Bihar goods and services tax act 2017 (the Bihar act 2017) has been rejected.

The petitioner is desirous of availing statutory remedy of appeal against the impugned order before the Appellate Tribunal (“Tribunal”) under Section 112 of the Bihar Goods and Services Tax Act (“B.G.S.T. Act”).

Due to the non-constitution of the Tribunal, the 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. Under the circumstances, the petitioner is also prevented from availing the benefit of stay of recovery of the 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.

It was viewed that in the case of Angel Engicon Private Limited vs. the State of Bihar & Anr., it was held that “If the petitioner deposits a sum equal to 20 per cent of the remaining amount of tax in dispute,  in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act, then the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act, for he cannot be deprived of the benefit, due to non- constitution of the Tribunal by the respondents themselves.”

A Coram comprising of Justice Madhuresh Prasad held that since the 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 the 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.

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 the constitution of the Tribunal, the respondent authorities would be at liberty to proceed further in the matter, by the law.

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