2023 (12) TMI 159 - HC - GST

Tax Appeal Granted: Partial Bank Account Unfreeze Allows Petitioner to Challenge Demand and File Statutory Appeal Within 4 Weeks

HC allowed petitioner's appeal against tax demand, granting liberty to file statutory appeal before Deputy Commissioner within 4 weeks. Court directed ... Recovery of input tax credit and penalty under Section 73 of the TNGST Act - statutory appeal - entertain appeal and decide on merits - freezing of bank account - interim withdrawal for filing appealStatutory appeal - entertain appeal and decide on merits - Petition disposed of with liberty to the petitioner to file the statutory appeal and direction to the Deputy Commissioner to entertain and decide the appeal on merits. - HELD THAT: - The writ petition challenging the order confirming demand of recovery of input tax credit, interest and penalty was not adjudicated on merits by this Court because the petitioner has an available statutory remedy. The petition is therefore disposed of by granting the petitioner four weeks' time to file the statutory appeal before the Deputy Commissioner, Tirunelveli. Upon filing within the stipulated period the Deputy Commissioner is directed to admit and adjudicate the appeal on its merits without being influenced by the pendency of this writ petition.Writ petition disposed; petitioner permitted to file statutory appeal within four weeks and Deputy Commissioner directed to entertain and decide the appeal on merits.Freezing of bank account - interim withdrawal for filing appeal - The question of freezing of the petitioner's bank account is to be decided by the Deputy Commissioner, with an interim direction permitting limited withdrawal for filing the appeal. - HELD THAT: - The Court declined to decide the legality or propriety of the bank account freeze and remitted that issue to the Deputy Commissioner for determination in the course of the statutory appeal or separate proceedings before him. As an interim, facilitative measure to enable the petitioner to prosecute the statutory appeal, the Deputy Commissioner is authorised to permit the petitioner to withdraw 10% of the amount required for filing the appeal from the frozen bank account within four weeks. This interim permission is limited to enabling the filing of the appeal and does not constitute an adjudication on the merits of the freezing.Freezing of bank account remitted to the Deputy Commissioner for decision; interim permission to withdraw 10% for filing the appeal within four weeks.Final Conclusion: The writ petition is disposed of by permitting the petitioner to file the statutory appeal within four weeks; the Deputy Commissioner, Tirunelveli, shall entertain and decide the appeal on merits. The issue of the frozen bank account is remitted to the Deputy Commissioner, who may, as an interim measure, permit a 10% withdrawal from the account to enable filing of the appeal. No costs. Issues involved: Confirmation of demand for recovery of Input Tax Credit (ITC) towards SGST and CGST, imposition of interest and penalty, statutory appeal remedy, freezing of petitioner's bank account.Confirmation of demand for recovery of ITC: The writ petition was filed against the order confirming the demand for recovery of ITC amounting to Rs. 1,58,258/- each towards SGST and CGST, with interest of Rs. 87,833/- on each tax demanded, and a penalty of Rs. 15,826/- each against the demand for SGST and CGST, invoking Section 73 of the TNGST Act.Statutory appeal remedy: The petitioner was granted liberty to file a statutory appeal before the Deputy Commissioner, Tirunelveli, within four weeks against the impugned order dated 08.05.2023. The Deputy Commissioner was directed to entertain the appeal and pass orders on its merits upon filing within the stipulated period.Freezing of petitioner's bank account: The petitioner's counsel raised the issue of the petitioner's bank account being frozen. The Deputy Commissioner was tasked with deciding on the freezing of the bank account. As an interim measure to enable the petitioner to file the appeal, the Deputy Commissioner was instructed to allow the petitioner to withdraw 10% of the required amount for filing the appeal from his bank account within four weeks. No costs were awarded, and connected miscellaneous petitions were closed.