Patna High Court
M/s. Pawan Int. UdyogversusThe State of Bihar
- Decided
- Disposal
- DISPOSED
Holding
The freezing order is ineffective because the underlying assessment order was already quashed, making the writ petition infructuous.
Summary
M/s. Pawan Int. Udyog filed a writ petition challenging a freezing order dated 06‑12‑2024 issued under Section 79 of the Bihar Goods and Services Tax Act, 2017, alleging that it was arbitrary, excessive and violated principles of natural justice. The petitioner sought quashing of the order, de‑freezing of its bank accounts, and a declaration that the order was procedurally flawed. The State counsel jointly submitted that the assessment order on which the freezing was based (dated 25‑04‑2024) had already been set aside in a separate case (CWJC No.7565 of 2025). The Court held that, because the underlying assessment order was nullified, the consequential freezing order could not stand and the writ petition became infructuous. Accordingly, the petition was disposed of without further relief. The decision rested on the principle that administrative actions must have a valid statutory foundation and cannot persist after the foundation is removed.
Issues considered
- Whether the freezing order issued under Section 79 of the Bihar GST Act was valid and complied with procedural requirements of natural justice.
- Whether the prior quashing of the assessment order in CWJC No.7565 of 2025 renders the freezing order void and the writ petition infructuous.
Subjects
- GST
- Section 79
- freezing order
- natural justice
- proportionality
- writ petition
- bank account freeze
- constitutional rights
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.7566 of 2025
======================================================
M/s. Pawan Int. Udyog through its Proprietor Krishnadeo Prasad Yadav,
Male, aged about 59 years, Son of Hari Yadav, Resident of Temple Kandopur,
Adampur, Nalanda, Bihar 803109.
... ... Petitioner/s
Versus
1. The State of Bihar through the Commissioner of State Taxes, Bihar, Office
of the Commissioner of State Taxes, 2nd Floor, Vikas Bhawan, Bailey Road,
Patna, Bihar.
2. The Joint Commissioner, State Taxes, Bihar Sharif, Office of the Joint
Commissioner, Circle Bihar Sharif, Commercial Taxes Building, Near Old
Bus Stand, Bihar Sharif, Nalanda, Bihar.
3. The Deputy Commissioner, State Taxes, Bihar Sharif, Office of the Deputy
Commissioner, Circle Bihar Sharif, Commercial Taxes Building, Near Old
Bus Stand, Bihar Sharif, Nalanda, Bihar.
4. The Assistant Commissioner, State Taxes, Bihar Sharif, Office of the
Assistant Commissioner, Circle Bihar Sharif, Commercial Taxes Building,
Near Old Bus Stand, Bihar Sharif, Nalanda, Bihar.
5. The Branch Manager, Punjab National Bank, Giriyak, Distt. Nalanda
(Bihar), Bihar-803109.
6. The Branch Manager, Dakshin Bihar Gramin Bank (DBGB), Giriyak, Distt.
Nalanda (Bihar), Bihar-803109.
... ... Respondent/s
======================================================
Appearance :
For the Petitioner/s : Mr.Harsh Kaushal, Advocate
For the State : Ms. Roona, AC to GP-7
For Respondent No.5 : Mr. Mritunjay Kumar Singh, Advocate
Mr. Ram Ganesh, Advocate
For the Respondent No.6: Mr. Kumari Rashmi, Advocate
======================================================
CORAM: HONOURABLE MR. JUSTICE MOHIT KUMAR SHAH
and
HONOURABLE MR. JUSTICE ARUN KUMAR JHA
ORAL ORDER
(Per: HONOURABLE MR. JUSTICE MOHIT KUMAR SHAH)
5 08-04-2026 The present writ petition has been filed seeking the
following reliefs:-
“(i) For quashing the freezing order dated contained in
Ref No. 892 Dated 06.12.2024, passed under Section 79
Patna High Court CWJC No.7566 of 2025(5) dt.08-04-2026
2/3
of the Bihar Goods and Services Tax Act, 2017, as being
arbitrary, excessive, and disproportionate. The freezing
order was issued without adherence to mandatory
statutory prerequisites, including prior notice, risk
assessment, and the opportunity for the Petitioner to
present a defense, contravening the principles of natural
justice and proportionality. Such premature coercive
action has resulted in irreparable financial harm,
business disruptions, and an unjust deprivation of the
Petitioner's fundamental rights under Articles 14, 19(1)
(g), and 21 of the Constitution of India as well as
constitutional right flowing from Article 301 of the
constitution of India.
(ii) Direct the Respondents to immediately de-freeze the
Petitioner's bank Account No 0677000100038132, PNB
Giriyak branch and OD Account No.71449300000464,
71449300000552, 71449300000516, 71442100000286 at
Dakshin Gramin Bank Giriyak, as the freezing was
disproportionate and unsupported by factual evidence or
legal justification. The Respondents failed to consider
material submissions and operational realities, including
moisture-related wastage, diversity in brick grades, and
actual sales records, which were ignored in favor of
arbitrary assumptions. The de-freezing of the account is
essential to restore the Petitioner’s access to financial
resources and business operations, thereby safeguarding
the livelihoods of employees, dependents, and
stakeholder's dependent on the Petitioner's enterprise.
(iii) To hold and declare the freezing order procedurally
flawed and legally unsustainable, given that the
Respondents relied on generalized benchmarks and
speculative calculations, disregarding statutory norms
and the Petitioner's specific business dynamics. The
Respondents failed to fulfill the statutory prerequisites
mandated under Section 79 of the Bihar GST Act,
including conducting a risk assessment and issuing
reasoned justifications, thereby breaching the principles
of equity, fairness, and natural justice. Judicial
Patna High Court CWJC No.7566 of 2025(5) dt.08-04-2026
3/3
intervention is necessary to set aside such arbitrary
administrative action and ensure adherence to statutory
obligations by the Respondents in future proceedings.”
2. The learned counsel for the respondent-State as
also the learned counsel for the petitioner have jointly submitted
that the order dated 25.04.2024 passed by the Joint
Commissioner State Tax, Biharsharif Circle in Case No.13 of
2024-25 (page No.48 to 50 of the present writ petition) has
already been quashed today by a separate order passed in one
another case of the petitioner bearing CWJC No.7565 of 2025,
hence the consequential action taken by the respondents have
been rendered null and void, thus the present writ petition has
become infructuous.
3. In view of the aforesaid, the present writ petition
stands disposed off.
(Mohit Kumar Shah, J)
( Arun Kumar Jha, J)
kanchan/-
U
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