Statutory appeal protects against coercive recovery of disputed tax demand pending appellate review.

Where a statutory appeal was available against an assessment under the Tamil Nadu Value Added Tax Act, 2006, the Court held that coercive recovery should not be pursued in a manner that defeats that appellate remedy. As the dispute involved factual findings that could be examined by the appellate authority, the petitioner was permitted to file the appeal within the stipulated time. The communication issued to the bank for realisation of the disputed amount was withdrawn, and immediate recovery was protected against while the statutory remedy remained available.

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Issues: Whether coercive recovery of the reversed input tax credit could be pursued pending the petitioner's statutory appeal, and whether the petitioner should be permitted to challenge the assessment before the appellate authority.

Analysis: The impugned assessment related to reversal of input tax credit under the Tamil Nadu Value Added Tax Act, 2006. The Court noted that the petitioner was willing to avail the statutory appellate remedy and that the dispute involved factual findings which could be agitated before the appellate authority. In these circumstances, the Court directed that the petitioner be allowed to prefer an appeal within the stipulated time. The Court also directed withdrawal of the communication sent to the bank for realisation of the disputed amount, so that recovery would not be pursued in that manner while the appellate remedy was available.

Conclusion: The petitioner was permitted to pursue the statutory appeal, and the coercive recovery step directed to the bank was withdrawn.

Final Conclusion: The writ petitions were disposed of with protection against immediate recovery and with liberty to work out the statutory appellate remedy.

Ratio Decidendi: When a statutory appeal is available against an assessment, coercive recovery of the disputed demand should not be pressed in a manner that defeats the appellate remedy.

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