Premature tax recovery from electronic credit ledger led to refund relief and liberty to pursue the statutory appeal.

Recovery of the demand from the electronic credit ledger within 16 days of the adjudication order was treated as premature because it occurred before the statutory recovery period expired after the time available for appeal. The court directed refund of the amount collected in excess of what was needed for pre-deposit, permitted the assessee to file the appeal offline within the time granted, and indicated that the appellate authority should take a lenient view on limitation if the appeal is filed within that period.

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Issues: Whether recovery of the demand was effected before expiry of the statutory period under Section 78 of the West Bengal Goods and Services Tax Act, 2017, and what consequential relief should follow.

Analysis: The demand arising from the adjudication order was recovered from the electronic credit ledger within 16 days of the order, before the period contemplated for recovery after the time available for appeal. The Court also directed that the amount collected in excess of the demand be refunded to the extent required for pre-deposit, and permitted the assessee to file the appeal offline within the time granted. If the appeal is filed within that period, the appellate authority is to take a lenient view on limitation.

Conclusion: The recovery was held to be premature and the assessee was granted limited consequential relief, including refund of the excess amount and liberty to pursue the statutory appeal.

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