Trader's Bank Account Unfrozen After Court Victory

The court ruled in favor of the petitioner, a trader registered under the Value Added Tax Act, allowing them to operate their bank account freely. The provisional attachment of the bank account was deemed invalid as no fresh attachment orders were issued after a specific date. With interim and final orders by the VAT Tribunal fulfilling the predeposit condition, the department could not recover further tax dues. The court concluded that the petitioner should be able to operate the bank account without restrictions, as the attachment order had expired with time and no outstanding dues existed.

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Issues:
1. Direction to permit the petitioner to operate the bank account.

Analysis:
The petitioner, a trader registered under the Value Added Tax Act, had his bank account provisionally attached by the VAT authorities due to outstanding tax demands. The petitioner challenged the assessment orders for the periods 2010-2011 and 2011-2012, with interim stays granted by the VAT Tribunal upon depositing specified amounts. The Tribunal remanded the proceedings for the year 2011-2012 to the first appellate authority while clarifying that the stay granted earlier would continue. The provisional attachment of the bank account, dated 12.2.2013, was argued by the petitioner to be invalid as no fresh attachment was made after 12.2.2014. The petitioner contended that with no enforceable demand currently existing, the department had no basis to attach the bank account.

The learned Additional Government Pleader did not dispute that no fresh attachment orders were issued after 12.2.2014. It was also acknowledged that due to the interim and final orders by the VAT Tribunal, the department could not recover any further tax dues from the petitioner as the predeposit condition had been fulfilled. The court, considering these facts, declared that the petitioner should be allowed to operate the bank account freely, as the attachment order had expired with time. Moreover, the court expressed doubts about the department's ability to take coercive action when no dues were outstanding from the dealer.

In conclusion, the petition was disposed of accordingly, permitting direct service and allowing the petitioner to operate the bank account without any restrictions.

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