Petitioner Ordered to Deposit Rs. 5 Crores for Frozen Accounts, Failure Results in Dismissal

The Court ordered the petitioner to deposit Rs. 5 crores with the respondents by a specified date to release frozen bank accounts due to unascertained tax dues. Failure to comply would result in dismissal of the writ petition and reattachment of accounts. The Court stressed strict adherence to the repayment schedule without extensions or reconsideration, allowing temporary release of accounts for payment facilitation.

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Issues:
Petitioner seeks release of frozen bank accounts due to coercive action by respondents for unascertained tax dues.

Analysis:
The petitioner filed a petition under Article 226 seeking the release of frozen bank accounts by the respondents, who initiated coercive action to recover unascertained tax dues. The petitioner contended that although service tax had been collected from clients, it had not been deposited in the Government treasury, leading to interest and penalty liabilities. The Court noted that the petitioner admitted a service tax liability of Rs. 12.77 crores for the period 2010-11 to 2014-15, totaling Rs. 18 crores plus interest. The Court found no agreement with the petitioner's argument that a previous judgment interfering with freezing of accounts would apply to this case. The petitioner proposed a repayment schedule, acknowledging the outstanding amount. The Court emphasized the importance of timely compliance and ordered the petitioner to deposit Rs. 5 crores with the respondents by a specified date, failing which the writ petition would be dismissed.

The Court considered the communication indicating non-payment of Rs. 5 crores by a certain date, highlighting the petitioner's failure to adhere to the proposed repayment schedule. After hearing arguments from both parties, the Court issued specific directives in the order. The petitioner was instructed to deposit the specified amount by a set deadline and provide proof of deposit to the Registrar. The Court temporarily released three bank accounts to facilitate the payment. However, any default in complying with the order would result in dismissal of the writ petition without further reference to the Court, allowing for reattachment and refreezing of the released accounts. The Court emphasized strict adherence to the order's terms, disallowing extensions or applications for reconsideration, even during vacation periods.

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