M/S Rathi Steel Power Limited Industrial Area South Of G.T. Road Ghaziabad vs. Union Of INDIA And 2 Others

Held

The Court held that the writ petition lacked merit and was liable to be dismissed. The attachment order dated October 10, 2018, was a consequential action stemming from the demand notice dated October 3, 2018, for excise dues and CGST. The petitioner had previously filed a writ petition (Writ Tax No. 1369 of 2018) wherein it had acknowledged its liability for these dues and sought to pay them in installments. This prior petition was dismissed as withdrawn on October 12, 2018, without granting liberty to file a fresh petition. Consequently, the stage for challenging the demand notice or seeking an opportunity for hearing had passed. The Court found no useful purpose in reiterating the same issues. Therefore, the petitioner could not be granted any relief unless the demand itself was successfully challenged, which was no longer possible at this stage. The ratio decidendi is that once a demand notice has become final due to non-challenge or withdrawal of a petition without liberty, subsequent recovery actions like attachment are valid and cannot be set aside on grounds that could have been raised earlier.

Facts

The petitioner, M/s Rathi Steel Power Limited, filed a writ petition challenging an attachment order dated October 10, 2018, issued by respondent no. 3. This attachment was based on a demand notice dated October 3, 2018, for excise dues and Central Goods and Service Tax (CGST). The petitioner had previously filed another writ petition (Writ Tax No. 1369 of 2018) concerning the same demand notice, wherein it prayed for permission to pay the excise dues in 12 installments and sought three months to clear the CGST liability. In that prior petition, the petitioner acknowledged its liability for excise dues and GST. The earlier writ petition was dismissed as withdrawn on October 12, 2018, without any liberty to file a fresh petition. The current attachment order is a consequential action following the unchallenged demand notice.

Key Issues

1. Whether the attachment order dated October 10, 2018, is liable to be quashed, considering the petitioner's prior acknowledgment of liability and withdrawal of a previous writ petition concerning the same demand notice. Petitioner's Argument: The petitioner sought to quash the attachment order. While not explicitly detailed, the implication is that the petitioner believed the attachment was unjustified or premature, possibly due to the prior proceedings. However, the judgment notes the petitioner did not challenge the demand notice itself. Respondent's Argument: The respondents contended that the attachment order was a consequential action pursuant to the demand notice dated October 3, 2018. They argued that the stage for challenging the demand notice and the opportunity for hearing had passed, especially since the petitioner had previously accepted the liability and withdrawn a writ petition without liberty to file a fresh one. Therefore, the attachment was a valid step to recover the dues.