The Calcutta High Court stayed the recovery proceedings as no prejudice to the taxpayer was caused by non-formation of the Goods and Service Tax Appellate Tribunal (GSTAT).
The intra-court appeal was filed by the writ petitioners, Jai Venktesh Concast Private Limited and Anr against the order passed by the Single Bench directing the appellants to pay 20% of the disputed tax within a time frame for being entitled to interim protection from recovery.
The question to be determined by the Court was whether the appellants could be put on further condition after the appellants had paid 10% of the disputed tax while preferring an appeal before the first appellate authority.
Under the West Bengal Goods and Services Tax Act, 2017 any person aggrieved by the order passed by the first appellate authority, is entitled to prefer an appeal to the Goods and Service Tax Appellate Tribunal. However, the Goods and Service Tax Appellate Tribunal is to be constituted which has necessitated the appellants to file the writ petition.
The Advocate for the appellants, Ankit Kanodia placed reliance on the decision of the Division Bench of the High Court of Bombay in the case of Rochem India Private Limited v. Union of India and Others.
Relying upon the said decision it was submitted that an affidavit has been filed in the said writ petition by the Chairman of the Central Board of Indirect Taxes and in the said affidavit it has been stated that no hardship is caused by the taxpayer due to non-formation of the Goods and Service Tax Appellate Tribunal as the period of limitation for filing an appeal to the Tribunal is extended by order dated 3rd December 2019 so that the appeal can be filed within three months after.
Debasish Ghosh, Advocate appearing for the State submitted that the decision rendered by the High Court of Bombay will not bind the respondent/West Bengal State Tax Authorities.
A Division Bench of the Calcutta High Court comprising Chief Justice TS Sivagnanam and Justice Hiranmay Bhattacharyya observed that “We are of the view that recovery proceedings should remain stayed without imposing any pre-condition. Accordingly, the authorities are restrained from initiating any coercive steps for recovery till the disposal of the writ petition. Consequently, the condition imposed by the Single Bench directing deposit of 20% of the disputed tax is set aside.”
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