Conditional release of bank attachment granted while pending tax appeal is directed to be heard on merits

Bank attachment may be lifted conditionally where the assessee has already challenged the assessment in appeal and the appeal has not been effectively heard. The Court directed release of the attachment and restoration of banking operations on proof of payment of 25% of the disputed tax, in addition to the amount already deposited. It also directed the appellate authority to take up the appeal and decide it on merits after giving due opportunity.

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Issues: Whether the bank attachment could be lifted on partial compliance with the disputed tax requirement, and whether the pending appeal should be heard and decided on merits.

Analysis: The assessment challenge had already been taken in appeal, and the appeal papers had been re-presented after rectification, but no effective consideration had taken place. In this situation, the Court accepted the request for a direction to the appellate authority and balanced the petitioner's grievance against the revenue's insistence on a further deposit by directing payment of 25% of the disputed tax, apart from the amount already deposited, as a condition for lifting the attachment. Upon proof of such payment, the attachment was to be withdrawn and the bank account made operable. The appellate authority was also directed to take up the appeal and decide it on merits after giving due opportunity.

Conclusion: The relief was granted in part in favour of the petitioner by ordering conditional release of the bank attachment and expeditious disposal of the appeal on merits.

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