Provisional attachment under VAT law requires pending assessment proceedings; penalty challenge left to statutory appeal.

Provisional attachment of bank amounts under the Andhra Pradesh Value Added Tax Act was held unsustainable where no assessment or reassessment proceeding was pending, because that power is confined to protecting the Revenue during such proceedings and cannot be used after they conclude or outside that context. The separate challenge to the penalty order, including complaints about objection consideration and personal hearing, was not interfered with because an effective statutory appeal was available and the appellate authority was the proper forum to examine those issues. The writ petition therefore succeeded only on the attachment issue.

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Issues: (i) Whether the provisional attachment of the petitioner's bank amounts could be sustained when no assessment, reassessment, or penalty proceeding was pending; (ii) whether the writ court should interfere with the penalty order in view of the availability of an appellate remedy.

Issue (i): The power of provisional attachment under section 27(2)(a) of the Andhra Pradesh Value Added Tax Act, 2005 is available only during the pendency of assessment or reassessment proceedings and where attachment is necessary to protect the interests of the Revenue. Section 29 operates in a different field relating to recovery after assessment and does not authorise attachment in the circumstances of the case.

Conclusion: The attachment order was not sustainable and was liable to be set aside.

Issue (ii): The challenge to the penalty order raised questions relating to consideration of objections and request for personal hearing, but the Court held that such matters were appropriate for examination by the appellate authority because an appeal remedy was available.

Conclusion: Interference with the penalty order was declined, leaving the petitioner to pursue the statutory appeal.

Final Conclusion: The writ petition succeeded only in relation to the attachment order, while the challenge to the penalty order was left to be pursued before the appellate forum.

Ratio Decidendi: Provisional attachment under section 27(2)(a) can be ordered only during pending assessment or reassessment proceedings for protecting revenue, and cannot be used after such proceedings have concluded or in the absence of pending proceedings.

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