Improper service of adjudication order justified quashing bank attachment and leaving statutory appeal open.

Where service of the adjudication order was not satisfactorily established under the Finance Act, 1994, the Calcutta HC interfered with the resulting coercive recovery and quashed the bank account attachment. The Court noted that mere assertion of dispatch by speed post was insufficient without proof of delivery in the manner required by the statutory service framework, and it also referred to a connected proceeding where exemption on receipts from governmental authorities had been accepted on facts. While preserving the merits of the tax dispute, the Court granted the petitioner liberty to pursue the statutory appeal in accordance with law, subject to compliance with costs.

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Issues: Whether the bank account attachment issued under section 87 of the Finance Act, 1994 was liable to be quashed in the facts of the case, and whether the petitioner should be granted liberty to pursue the statutory appeal.

Analysis: The dispute turned on service of the order-in-original and the consequent opportunity to challenge it. The Court noted that the respondents asserted dispatch by speed post, but did not satisfactorily establish service by proof of delivery in the manner contemplated by the statutory framework governing service of orders under the Finance Act, 1994. The Court also noticed that in a connected proceeding for a subsequent period, exemption in respect of receipts from governmental authorities had been accepted on facts, which strengthened the petitioner's case for giving the benefit of doubt in the present matter. At the same time, the Court refrained from expressing any final view on the merits of the exemption claim and preserved the appellate remedy.

Conclusion: The attachment of the petitioner's bank account was quashed, and the petitioner was permitted to prefer an appeal in accordance with law upon compliance with the imposed costs.

Final Conclusion: The writ petition resulted in limited relief by setting aside the coercive recovery step while leaving the substantive tax dispute open for adjudication before the appellate authority.

Ratio Decidendi: Where service of an adjudication order is not satisfactorily established, coercive recovery based on that order may be interfered with and the assessee may be allowed to pursue the statutory appeal.

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