TMI Blog2020 (3) TMI 520X X X X Extracts X X X X X X X X Extracts X X X X ..... issued under Section 44 of the VAT Act to the petitioner. The learned Assistant Government Pleader stated that after expiry of the provisional attachment order on completion of one year, it was extended only for a period of one year and thereafter, the same was not extended. Therefore, as on today, provisional attachment order is not in existence, as per Sub-section (2) of Section 45 of the VAT Act. The impugned notices dated 07.05.2012 and 11.05.2012, issued under Section 44 of the VAT Act, are hereby quashed and set aside - Petition allowed. - R/SPECIAL CIVIL APPLICATION NO. 307 of 2013 - - - Dated:- 21-1-2020 - MR. J.B. PARDIWALA AND MR. BHARGAV D. KARIA JJ. Appearance: Mr. Saurabh M Patel(5019) for the Petitioner(s) No. 1 Mr. Soaham Joshi, AGP (1) for the Respondent(s) No. 1 MR. PJ Kanabar(1416) for the Respondent(s) No. 2 Rule Served(64) for the Respondent(s) No. 3 ORAL ORDER (PER : MR.BHARGAV D. KARIA, J.) 1. By this petition, under Article 226 of the Constitution of India, the petitioner has prayed for the following reliefs: A. Admit and allow this petition; B. Issue writ of mandamus and/or any other appropriate w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rporation. 2.3. The respondent No.3 was issued a certificate of registration dated 19.11.2010, under the provisions of the Gujarat Value Added Tax Act, 2003 (for short the VAT Act ). 2.4. Thereafter, the respondent No.1-Assistant Commercial Tax Commissioner issued a notice under Section 45(1) of the VAT Act on 21.11.2011 for provisional attachment of the aforesaid goods which was secured with the petitioner-Bank. 2.5. It appears that the respondent No.1- Assistant Commercial Tax Commissioner issued notices dated 07.05.2012 and 11.05.2012 to the petitioner-Bank under Section 44 of the VAT Act to pay the dues of the respondent No.3. It also appears that the petitioner-Bank had also issued a demand notice on 24.05.2015 to the respondent No.3 to make payment of its outstanding dues of ₹ 42,35,700/-. 3. Being aggrieved by the aforesaid notices issued by the respondent No.1 under Section 44 of the Act, the petitioner-Bank has filed this petition. 4. On 28th March, 2013, a co-ordinate Bench of this Court passed the following order: The petitioner Cooperative bank has challenged the notices issued by the department of Value Added Tax, seeking recovery of tax du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthorised representative of the petitioner as well as respondent no.1. This exercise will be completed latest by 15.5.2013. 3) After taking into consideration the valuation report supplied by the Warehousing Corporation, objections, if any, by the petitioner and its own input, respondent no.1 shall fix the minimum upset price below which the goods would not be sold. This will be done by 31.5.2013. 4) Once this is done, respondent no.1 shall hold public auction of the goods which may be completed within 90 days thereafter. 5) Out of the sale proceeds realised through such public auction, respondent no.1 shall first deduct and pay over the dues of respondent no.2 Warehousing Corporation calculated upto the date of auction. The remaining amount shall be deposited before the Registry of this Court, which in turn, shall invest the same in any nationalised bank initially for a period of one year which shall be renewed from time to time, till disposal of the petition. 5. In compliance of the above order dated 28th March 2013, the 200 cotton bales were auctioned and an amount of ₹ 36,53,323/- was received and from that ₹ 1,08,342/- was paid to the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s from the record that the respondent No.1 passed an order of provisional attachment, under Section 45 of the VAT Act after the petitioner advanced a loan to the respondent No.3. 11. In order to consider the submissions of the learned advocate for the petitioner, with regard to the jurisdiction of the respondent No.1 to issue notice under Section 44 of the VAT Act, is concerned, it would be germane to refer to Sections 44, 45 and 48 of the VAT Act, which read thus: Section 44: Notwithstanding anything contained in any law or contract to the contrary, the Commissioner may at any time or from time to time , by notice in writing, a copy of which shall be forwarded to the dealer at his last known address, require, - (a) any person from whom any amount of monies is due, or may become due, to a dealer on whom notice has been served under sub-section (1), or (b) any person who holds or may subsequently hold monies for or on account of such dealer, to pay the Commissioner, either forthwith upon the monies becoming due or being held or within the time specified in the notice (but not before the monies becomes due or is held as aforesaid) so much of the monies as is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndisputably, the Bank put forward its claim over the secured assets of the Bank for the first time on 01.10.2016 and that too by way of provisional attachment of the properties under Section 45 of the VAT Act, keeping in mind the dues that may be determined in future. It is not in dispute that there were no crystallized dues as on 01.10.2016 and, therefore, there was no question of there being any charge under Section 48 of the VAT Act which could only be in respect of the actual dues. It is also not in dispute that prior to the dues being crystallized in the case of the defaulting dealer, the Bank had already taken over the possession of the properties of the dealer, and by that time, Section 31B of the RDB Act had already been enforced by the Central Government. It is preposterous to suggest that the charge over the property under Section 48 of the State Act would come into force from the assessment of the earlier financial years and what is relevant in the present case is that the dues and resultantly the charge under Section 48 of the VAT Act came into existence after the implementation of Section 31B of the RDB Act. 51. Section 48 of the VAT Act would come into play ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he SARFAESI Act or Section 31B of the RDB Act, Section 48 of the VAT Act would come into play only after the determination of the tax, interest or penalty liable to be paid to the Government. Only thereafter it could be said that the Government shall have the first charge on the property of the dealer. 14. In view of the above observations made by this Court and in the facts of the case, provision of Section 48 of the VAT Act would not come into play and therefore, the respondent No.1 could not have issued provisional attachment order under Section 45 of the VAT Act, nor notice could have been issued under Section 44 of the VAT Act to the petitioner. 15. The learned Assistant Government Pleader stated that after expiry of the provisional attachment order on completion of one year, it was extended only for a period of one year and thereafter, the same was not extended. Therefore, as on today, provisional attachment order is not in existence, as per Sub-section (2) of Section 45 of the VAT Act. 16. In view of the foregoing reasons, the impugned notices dated 07.05.2012 and 11.05.2012, issued under Section 44 of the VAT Act, are hereby quashed and set aside. With regard to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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