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Court rules Authorities must allow appeal before recovering tax. Excessive recovery ordered refunded. Bank account access restored. The Court held that Authorities cannot recover amounts under the West Bengal Goods and Services Tax Act without allowing the petitioner to appeal within ...
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Provisions expressly mentioned in the judgment/order text.
Court rules Authorities must allow appeal before recovering tax. Excessive recovery ordered refunded. Bank account access restored.
The Court held that Authorities cannot recover amounts under the West Bengal Goods and Services Tax Act without allowing the petitioner to appeal within the stipulated time. Recovery exceeding 20% of the disputed tax within the appeal period is excessive. The Authorities were directed to refund the excess amount to the petitioner within 15 days, cancel the attachment order, and allow the petitioner to operate their bank account. The Court disposed of the application, giving the respondents time to file an affidavit-in-opposition, with further proceedings scheduled for March 2020.
Issues: Recovery of excessive amount by Authorities under the West Bengal Goods and Services Tax Act, 2017 without allowing the petitioner to file an appeal before the Appellate Court within the stipulated time frame.
Analysis: The petitioner filed a writ petition under Article 226 of the Constitution of India, challenging the recovery of Rs. 1,41,10,717 subsequent to the orders passed by the First Appellate Authority. The petitioner contended that they have the right to appeal before the Tribunal under Section 112 of the West Bengal Goods and Services Tax Act, 2017 within three months of the appellate authority's order. However, as there was no Appellate Tribunal available, the petitioner approached the High Court for relief.
The Court observed that when an appeal provision exists under the statute, Authorities cannot recover the amount payable unless there are exceptional circumstances. In this case, the dispute pertained to a classification issue, and the Authorities were deemed to have acted hastily by recovering the entire amount within the three-month appeal period. The learned Additional Advocate General for the State argued that recovery was initiated due to a subsisting provisional attachment, and the entire amount was recovered after waiting for over a month.
The Court held that as per Section 112(8)(b) of the said Act, Authorities are only entitled to recover up to 20% of the disputed tax amount. Any recovery exceeding this limit within the three-month appeal period is considered excessive. Consequently, the Authorities were directed to refund the excess recovery to the petitioner's bank account within 15 days, allowing the petitioner to operate the account with the attachment order being canceled.
The Court disposed of the application, emphasizing that since no affidavit-in-opposition was called for, the allegations in the application were not deemed admitted by the respondents. The respondents were given four weeks to file an affidavit-in-opposition in the main writ petition, with a subsequent two-week period for the petitioner to file an affidavit-in-reply. The matter was scheduled to appear in the monthly list of cases for March 2020 for further proceedings.
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