Coercive tax recovery is unwarranted during pending appeals when a valid bank guarantee and stay protection remain in force.

Where tax demands remain under appeal and the assessee has already complied with the appellate authority's deposit condition and furnished a valid bank guarantee, coercive recovery by attaching bank accounts is not justified. The text states that such recovery action should not proceed while the appeals are pending and an existing stay protection continues to operate. It also notes that the appellate authority should dispose of the appeals expeditiously, and coercive steps are inappropriate until that process is concluded or lawful stay protection has ceased.

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Issues: Whether the attachment of the petitioner's bank accounts and the direction to remit the demanded tax amounts were justified when the statutory appeals were pending and a bank guarantee was already in force.

Analysis: The writ applicant had already deposited the amounts directed by the first appellate authority and had furnished a bank guarantee, which continued to remain valid. The appeals against the assessment orders were still pending, and the earlier stay had been operating for several years. In these circumstances, the impugned recovery action by attaching the bank accounts and directing the bank to issue demand drafts for the disputed dues was held to be unjustified. The appellate authority was required to proceed with the appeals expeditiously, and coercive recovery was not warranted until their disposal.

Conclusion: The attachment and recovery direction were set aside, and the petitioner succeeded on this issue.

Final Conclusion: The petitioner obtained protection against coercive recovery during pendency of the appeals, and the appellate authority was directed to decide the appeals within a fixed time.

Ratio Decidendi: When tax demands are under appeal and secured by an operative bank guarantee, coercive recovery by attachment of bank accounts is not justified unless the appellate process has been concluded or the stay protection has lawfully ceased.

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