M/S.Maa Tarini Engineering, Talcher vs. Addl. CT And GST Officer, Angul

Facts

The petitioner, M/s. Maa Tarini Engineering, challenged an order by the Additional CT & GST Officer, CT & GST Circle, Angul, which rejected their prayer for lifting the attachment of their bank account. The revenue admitted that the second attachment of the petitioner's account was an inadvertent error. However, they contended that the petitioner still owed interest of Rs. 20,465/- and a penalty of Rs. 31,680/-. The petitioner's counsel presented proof of payment for the penalty and undertook to pay the interest immediately after the attachment was lifted. The court also considered an order permitting the use of the Electronic Ledger for payment, referencing a circular.

Held

The Court held that the order dated 31st December, 2022, passed by the CT & GST Officer rejecting the Petitioner’s prayer for lifting the attachment was unsustainable and therefore set aside. The Court also held that the order dated 9th November, 2022, passed by Opposite Party No.1 was without jurisdiction and quashed it. The reasoning was based on the admission by the revenue that the second attachment was an inadvertent error. The Court directed that the attachment of the Petitioner’s bank account be immediately lifted. The Petitioner was directed to pay the interest amount of Rs.20,465/- within three days from the date of the order. The ratio decidendi is that an attachment made erroneously and without jurisdiction, despite admissions of error by the revenue, should be set aside, and the petitioner should be granted relief upon undertaking to clear outstanding dues promptly.

Key Issues

1. Whether the order dated 31st December, 2022, passed by the CT & GST Officer, rejecting the Petitioner’s prayer for lifting the attachment, was legally sustainable? (Mixed question of law and fact, concerning the propriety of continuing attachment despite admitted error). 2. Whether the order dated 9th November, 2022, passed by Opposite Party No.1, was without jurisdiction? (Question of law, concerning the authority and scope of action by the Opposite Party). Petitioner's Arguments: The petitioner argued that the attachment was erroneous, especially the second instance, and sought its immediate lifting. They presented proof of penalty payment and committed to paying the interest once the attachment was removed. Revenue's Arguments: The revenue admitted the error in the second attachment but maintained that the petitioner was liable for the interest amount of Rs. 20,465/- and the penalty of Rs. 31,680/-. They relied on an order permitting the use of the Electronic Ledger for payment, referencing Circular No.172/04/2022-GST.