TMI Blog2017 (12) TMI 1012X X X X Extracts X X X X X X X X Extracts X X X X ..... f the bank accounts is to be set aside. Issuance of the impugned notices of attachment during pendency of the appeal and the stay application of the petitioner - Held that: - it is expected of the authority to stay its hands till the stay application is decided, unless the same is not decided on account of default on the part of the petitioner or it is found that the petitioner is unnecessarily delaying the hearing of the stay application and in absence of any exceptional circumstances, there is no warrant for the respondent authorities to proceed to initiate coercive recovery in exercise of powers under section 44 of the Act by attaching the bank account of the petitioner. Petition allowed - decided in favor of petitioner. - Special ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticipated in the assessment proceedings and filed his reply along with necessary documents. However, unimpressed by the submissions of the petitioner, the assessing authority passed assessment order dated 23.1.2017 disallowing the input tax credit to the tune of ₹ 28,76,541/- on the purchases made by the petitioner from various vendors. The same gave rise to differential tax dues of ₹ 28,04,841/- which were further coupled with interest of ₹ 19,27,767/- imposed under section 42(5) of the Act and composite penalty of 100% of ₹ 28.04,841/- imposed under sections 34(7) and 34(12) of the Act. Thus, the total dues raised amounted to ₹ 75,37,449/-. 3. Aggrieved by the aforesaid assessment order, the petitioner app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner. Another notice dated 15.11.2017 was issued directing the Manager, Punjab National Bank, Jamnagar to freeze the debit side of Cash Credit Account No.87390 held by him. 6. Mr.Apurva N. Mehta, learned advocate for the petitioner has contended that the impugned notices do not satisfy the pre-requisite of debtor-creditor relations with third person, as envisaged under section 44 of the Act. He has submitted that the respondent authority cannot seek to recover the tax dues by attaching the bank accounts which lack characteristics of debtor-creditor relationship. In support of his submissions, reliance is placed on the judgment dated 27.6.2016 passed by this Court in Special Civil Application No.14497 of 2014. Thus, he has urged that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editor relationship. 9. The learned AGP has also submitted that the petitioner has belatedly approached the concerned authorities. He has stated that the assessment order was passed on 23.1.2017, whereas the petitioner has approached the first appellate authority by filing appeal on 14.8.2017, beyond the period of limitation of 60 days. He has submitted that the appellate authority is yet to decide the stay application of the petitioner, hence, the impugned notices do not call for interference by this Court. 10. Having heard the learned advocates for the parties, we may gainfully extract the provisions of section 44 of the Act, which read as under: 44. Special mode of recovery. ( 1) Notwithstanding anything contained in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler, and the receipt thereof by the Commissioner shall continue a good and sufficient discharge of the liability of such person to the extent of the amount specified in the receipt. ( 4) Any person discharging any liability to the dealer after receipt of the notice referred to in this section, shall be personally liable to the Commissioner to the extent of the liability discharged or to the extent of the liability of the dealer for tax, penalty and interest, whichever is less. ( 5) Where a person to whom a notice under this section is sent objects to it by a statement in writing that the sum demanded or any part thereof is not due or payable to the dealer or that he does not hold any monies for or account of the dealer, the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to section 44 of the Act. After due analysis of the phraseology of the provisions and considering various judgments on the issue in question, the Division Bench set aside aside the impugned notices of attachment of the bank accounts by observing that the bank and the assessee do not have debtor-creditor relationship. Unhesitatingly, we adopt the view expressed by the Division Bench and other higher courts referred to in the aforesaid judgment. 11. Another aspect which necessitates observations of this Court pertains to issuance of the impugned notices of attachment during pendency of the appeal and the stay application of the petitioner. The facts established from the record reveal that after condoning the delay, the petitioner was inti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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