TaxTMI 
TaxTMI 
2019 (8) TMI 434
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.....25 crores to the Revenue before the issue of any show cause notice under the Finance Act, 1994. 2. It is the case of the Petitioners that the aforesaid amount of Rs. 11.25 crores was reversed by the Petitioners as the Respondents during investigation threatened arrest in the absence of payment/reversal of Cenvat Credit. This even though the Petitioners had given to the officers of the Revenue opinions of Advocates to the effect that no arrest in such facts is permissible. The Petitioners placed reliance upon the decisions of the Supreme Court in Dabur India Ltd. vs. State of Uttar Pradesh [1990 4 SCC 113] along with the orders of this Court in Vodafone Essar South Ltd. vs. Union of India [2009 237 ELT 35 (Bom.) and Cleart....
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...., Mr.Kantharia, learned Counsel appearing for the Respondents, filed an additional affidavit in reply of Mr.Abhijit Thorat, Assistant Commissioner of CGST & Central Excise, Mumbai (East) Commissionerate, dated 29 July 2019. In the above affidavit, the deponent has explained the reason why the show cause notice dated 28 September 2018, as amended by the corrigendum dated 9 October 2018, could not be adjudicated till today. 3. The issue in the present facts, as pointed out above, was the action of the Respondents in pressuring the Petitioners under the threat of arrest of its Directors/officers at the time of investigation to reverse Cenvat Credit amounting to Rs. 11.25 crores taken as tax paid on services provided by one Indo Globa....
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.... the affidavits filed by the Revenue that no threat of arrest was given to the Petitioners. There is no reason to disbelieve the Revenue. Thus, no interference in writ jurisdiction is warranted. It is further submitted that the show cause notice is pending adjudication and therefore, no purpose would be served by permitting the Petitioners to recredit the amount, which was reversed by the Petitioners at the instance of the Respondents, as if the show cause notice is adjudicated in favour of the Petitioners, the amount would be refunded to the Petitioners in any case. Thus, dismiss the petition. 5. We have considered the rival submissions. The issue raised in the petition, if correct, gives rise to a very serious issue of Rule of law. How....
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....state that neither any written nor oral communications were issued to the petitioners for "the threat of arrest". The contention of the Petitioner is far from the truth. Assuming without accepting the malicious allegations levelled by the Petitioners, they being the responsible citizens of India, ought to have approached the proper forum for their redressal than approaching this Hon'ble High Court." This does not dispute the facts contemporaneously recorded in the Petitioners' letters dated 7 May 2018. Thus, in these facts, we find that the Petitioners were coerced to reverse the Cenvat Credit under the threat of arrest. 6. Therefore, we now examine the issue, whether such action on the part of the Revenue is at all permissibl....
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.... gross abuse of the powers vested in them under the Customs Act. Similarly, in Cleartrip Pvt. Ltd. vs. Union of India (supra) 2016 (4) STR 948, this Court observed as under : "16. We are clear in our minds and from the scheme of the Act and the Law as a whole that coercive measures, including effecting any arrest, would arise only when investigation has been completed and on launching the prosecution. If the prosecution is a criminal prosecution, then, there is no question of deviating or defeating from the Criminal Law. The Criminal Law contains several provisions including protective measures, which would enable the Petitioners to resist any arrest, as apprehended. In the scheme of the Criminal Law and particularly the Finance Ac....
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....ay permissible and particularly in the given facts and circumstances of the case." 7. Therefore, the Supreme Court as well as our High Court has repeatedly held that rule of law has to be followed and no officers of the respondent can take law in his own hands or take extralegal steps or manoeuvre so as to collect amounts which have not yet been held by judicial and/or quasi judicial order as payable by the petitioners to the respondent. The affidavit in reply merely states that if the Respondents had given such threats to the Petitioners, then the Petitioners should have approached the proper forum for their redressal. This does not meet the allegations made by the Petitioners on oath that the Petitioners were threatened with possible a....