Tax recovery by bank attachment moderated through instalment payment, with account operation restored after the first instalment.

Bank attachment and recovery notices issued for tax arrears under the Tamil Nadu Value Added Tax Act were addressed by granting conditional relief. The petitioners were permitted to clear the arrears in eight equated monthly instalments, and the bank attachment was to be withdrawn on payment of the first instalment. Upon that payment, they were allowed to operate their bank accounts, while the revenue's right to recover the balance was preserved if there was default.

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Issues: Whether the bank attachment and recovery notices issued under Section 45 of the Tamil Nadu Value Added Tax Act, 2006 should be interfered with and whether the petitioners should be permitted to operate their bank accounts while paying the demanded arrears in instalments.

Analysis: The petitioners faced recovery action by way of attachment of bank accounts pursuant to demand notices for arrears of tax. The Court accepted the request for a practical mode of compliance and directed that the arrears be paid in eight equated monthly instalments commencing from 16.11.2015. It was also directed that, on payment of the first instalment, the bank attachment would be withdrawn and the petitioners would be allowed to operate their bank accounts, while preserving the revenue's right to recover the balance on default.

Conclusion: The petitioners obtained conditional relief against immediate coercive recovery, with permission to operate their bank accounts upon payment of the first instalment and with the arrears to be paid in instalments.

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