Bank account attachment for GST dues set aside, installment payment plan ordered under Section 80

The AP HC set aside the attachment of petitioner company's bank accounts for GST dues recovery and rejection of installment payment request. The Court found that blanket attachment would halt company operations and prevent salary payments to employees. Invoking Section 80 of GST Act, which permits Commissioners to allow payment in monthly installments up to twenty-four months, the Court directed petitioner to pay tax arrears in six monthly installments from April 15, 2024 to September 15, 2024. The impugned proceedings and Form GST DRC-13 were set aside, with the writ petition disposed of accordingly.

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Issues:
1. Rejection of request for payment of tax in installments by the 1st respondent.
2. Dispute regarding non-payment by principal contractor leading to tax arrears for the petitioner.
3. Issuance of garnishee notices by the 1st respondent for tax recovery.
4. Freezing of petitioner's bank account by the 1st respondent.
5. Petitioner seeking extension of time for tax payment in installments.

Analysis:
1. The petitioner, a private company executing works contracts, faced rejection of their request for tax payment in installments by the 1st respondent, leading to the filing of a writ petition challenging this action.
2. Due to non-payment by the principal contractor, the petitioner accumulated tax arrears of Rs. 1,77,12,294, as payments were withheld by the State Government, prompting the petitioner's inability to settle tax dues.
3. The 1st respondent issued garnishee notices to the principal contractor for tax recovery, with the court later modifying the order to allow payment upon receipt of dues from any contractor, specifying a timeline for tax deposit.
4. The freezing of the petitioner's bank account by the 1st respondent hindered operations, prompting the petitioner to file a writ petition seeking relief from the attachment.
5. The petitioner sought an extension of six months to repay tax arrears in installments, which was contested by the Government Pleader for Taxes, emphasizing the department's focus on arrears recovery.

Court's Decision:
1. The court set aside the rejection of the petitioner's request for installment payment, allowing the petitioner to repay tax arrears in six monthly installments from April to September 2024.
2. The court also annulled the garnishee notices and the bank account attachment, emphasizing the need for a pragmatic approach in considering the petitioner's circumstances and ensuring tax repayment as per the specified timeline.
3. The judgment highlighted the importance of balancing tax recovery with the petitioner's operational needs, citing relevant provisions of the GST Act to support the decision for installment payment.
4. Ultimately, the writ petition was disposed of without costs, with pending petitions closed, providing a comprehensive resolution to the issues raised by the petitioner regarding tax payment challenges and the actions of the 1st respondent.

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