TaxTMI 
TaxTMI 
2015 (12) TMI 494
X X X X Extracts X X X X
X X X X Extracts X X X X
....Petition by which the Respondent Bank other than the statutory authorities have been directed not to allow the Petitioner to operate the bank accounts. These bank accounts have been frozened pursuant to the communications from the Directorate General of Central Excise Intelligence, Mumbai Zonal Unit. 3. The Petitioner before us is a sole Proprietor carrying on business in the name and style mentioned in the cause title. Respondent Nos. 1 and 2 are the Deputy Director and Additional Director General in the Directorate General, Central Excise Intelligence. These are officers invested with powers of investigation under the Central Excise Act, 1944. They can also investigate the places of evasion and non payment of service tax under Chapter-V ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the allegations and asserting that the service tax due and payable in law has been paid. The Petitioner requested for a personal hearing. 7. The Additional Director, however, has not placed the matter for a personal hearing nor has he passed any order on the show cause notice. However, the allegation in the Petition and throughout is that instead of any adjudication in relation to the demand and pursuant to the show cause notice, the banks have been intimated to freeze the accounts. Thus, the recovery proceedings have been initiated without any adjudication order being passed. Once the Petitioner came to know that the notices have been issued under Section 87 of the Finance Act, then, the Petitioner has got in touch with the department and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ndia) Pvt Ltd v/s Deputy Director, DGCEI, Zonal Unit, Mumbai (2015 (317) E.L.T 248 (Bom) (c) ICICI Bank Ltd v/s Union of India 2015 (38) S. T. R. 907. (Bom.) (d) Order dated 31st March 2015 in Writ Petition No.3313 of 2015 (Vodafone India Ltd v/s Union of India and Others) (e) Tata Teleservices Maharashtra Ltd v/s M. F. Department of Revenue (2014 (307) ELT 90 (Bom.) 9. The factual position has not been denied or disputed. However, Mr Jetly appearing on behalf of the Respondents strenuously urged that it is not necessary in the facts and circumstances of the present case to wait for any adjudication because the dues which are admitted, remain unpaid. He would invite our attention to page 56 of the paper book wherein the Directorate Gene....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ears 2013-2014. The show cause notice in paragraph 3 onwards sets out as to what was revealed during the search and from the statement of the sole proprietor Shri Mourya. Then, in paragraph 4, there is a reference made to CENVAT credit register. The documents that were sought from the Petitioner by the Directorate are then referred in paragraph 4 and from paragraph 4.1 the service tax invoices are referred with a specific allegation that these would indicate how the service tax has been recovered but intentionally not deposited in the Government treasury. Then, reference to the payment made in part and how the service tax is leviable in terms of the legal provisions, has been set out. Thus, the demand is based on the allegation that there i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....annot be recovered by the mode found to be applicable in that case. The word 'due' has been interpreted to mean something which is payable and recoverable. The Hon'ble Supreme Court held that it does not refer merely to a liability created by the charging sections to pay the tax under the relevant law. It refers to an ascertained liability for payment of tax quantified in accordance with law. In other words, the taxes as assessed which are presently payable by the notified person are taxes which have been taken into account. It is in that context and carrying this principle further that the Division Bench of this Court applied it to recovery under Section 87 of the Finance Act, 1994. The reliance placed on the judgment of ICICI ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....x. Unless and until in case before us there is a crystallization of a demand by proper adjudication order and on hearing the Petitioner, there was no question of any recovery. Even if the letters have been addressed to the bank and there has been a freezing of the account, yet, we find that till date there is no adjudication order passed. The show cause notice has been issued more than a year back. In the circumstances, allowing the Petitioner's account to be frozen would not be in accordance with law. Precisely after referring to all cases and similar that too of the Petitioner before us, a Division Bench in ICICI Bank(supra) analyzes provisions of the Finance Act and concludes that there cannot be a recovery. Such a conclusion is reac....