Unitac Energy Solutions (INDIA)PVT LTD vs. The Assistant Commissioner (St)(Fac)
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The petitioner, Unitac Energy Solutions (India) Private Limited, filed a writ petition seeking a Mandamus to direct the Commissioner (Commercial Tax) to dispose of its application dated 23.05.2024, filed under Section 80 of the GST Act. Previously, in W.P(MD)No.14732 of 2024, this Court had directed the respondent to dispose of the petitioner's application within 60 days and keep recovery proceedings in abeyance. However, a garnishee notice dated 11.06.2024 was issued to M/s. Indus Towers Limited for arrears of tax amounting to Rs.35,19,160/-, leading to withholding of funds due to the petitioner. The petitioner contended that Rs.9,00,000/- had already been recovered and that continued garnishee proceedings would cause hardship and violate the Court's earlier directions. The respondents stated that the garnishee proceedings predated the earlier writ order but assured efforts to comply with the disposal direction.
Held
The Court directed the petitioner to deposit a further sum of Rs.2,00,000/- within two weeks. Upon receipt of this deposit, the respondents were ordered to withdraw the garnishee proceedings forthwith. Recovery proceedings are to be kept in abeyance until the disposal of the petitioner's application filed under Section 80 of the GST Act. The Court reasoned that this conditional interim relief would balance the interests of both parties while ensuring the petitioner's application is considered. If the petitioner fails to comply with the deposit condition, the respondents are at liberty to proceed with recovery as per law. The writ petition was disposed of with these directions. The issue of whether the garnishee proceedings were in violation of the prior order was implicitly addressed by ordering their withdrawal upon a further deposit, effectively providing a temporary reprieve.
Key Issues
1. Whether the garnishee proceedings initiated against M/s. Indus Towers Limited, a third party, for recovery of tax arrears from the petitioner, are in violation of the Court's previous order dated 03.07.2024 in W.P(MD)No.14732 of 2024, which directed the keeping of recovery proceedings in abeyance for 60 days. (Question of law and fact, concerning Section 80 of the GST Act and the Court's earlier order). Petitioner's Arguments: The garnishee proceedings are in violation of the Court's direction to keep recovery proceedings in abeyance. Continued garnishee proceedings will cause significant hardship to the petitioner, especially after a substantial amount has already been recovered. The garnishee notice was issued after the Court's order to stay recovery. Revenue/State's Arguments: The garnishee proceedings were initiated prior to the Court's order in W.P.(MD).No.14732 of 2024. The Commissioner will endeavor to comply with the Court's direction to dispose of the application within 60 days.
Sections Cited
Section 80
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Before: and
This writ petition is filed praying for a Mandamus to dispose of the application, dated 23.05.2024 filed by the petitioner under Section 80 of the GST Act.
The petitioner had earlier filed a writ petition in W.P(MD)No.14732 of 2024, wherein, this Court was pleased to pass the following order dated 03.07.2024:
"
Having considered the submissions made by the learned counsel for the petitioner, I am inclined to dispose of this Writ Petition by directing the second respondent to dispose of the petitioner's application dated 23.05.2024, filed under 2/6 https://www.mhc.tn.gov.in/judis Section 80 of the Act, within a period of 60 days from the date of receipt of a copy of this order, in the light of the recommendation made in the 53rd GST Council Meeting held on 22.06.2024 and subject to the Notification to be issued to that effect.
Considering the same, the respondents are directed to keep all recovery proceedings in abeyance for a period of 60 days from the date of receipt of a copy of this order. In case Notification is issued, suitable orders may be passed. In case no Notification is issued pursuant to recommendation made in the 53rd GST Council Meeting held on 22.06.2024, the petitioner's application dated 23.05.2024 may be suitably considered and disposed of."
It is submitted that 60 days period specified in the above order expires only on 03.09.2024. However, a garnishee notice dated 11.06.2024, was issued to M/s.Indus Towers Limited with regard to the arrears of tax to an extent of Rs.35,19,160/-. Consequent to which, M/s.Indus Towers Limited has withheld the money due to the petitioner. The petitioner was unaware of the above garnishee proceedings, when the earlier writ petition was disposed of vide order, dated 03.07.2024. It is submitted by the learned Counsel for the petitioner that already Rs.9,00,000/- has been recovered from the petitioner. It 3/6 https://www.mhc.tn.gov.in/judis is also submitted that, if the garnishee proceedings continues, they will be put to great hardship. The learned Counsel for the petitioner would further submit that the garnishee proceedings is in violation of the directions of this Court.
The learned Additional Government Pleader for the first and second respondents would submit that the garnishee proceedings were issued even prior to the order passed in W.P.(MD).No.14732 of 2024. However, the learned Additional Government Pleader would submit that the Commissioner will endeavour to comply with the direction of this Court vide order, dated 03.07.2024, insofar as the respondents were directed to dispose of the application within a period of 60 days from the date of receipt of the copy of the said order.
In the circumstances, the petitioner is directed to deposit a further sum of Rs.2,00,000/- within a period of two weeks from the date of receipt of a copy of this order. On receipt of the same, the respondents shall withdraw the garnishee proceedings forthwith and recovery proceedings shall be kept in abeyance until the disposal of the application under Section 80 of the Act. If the 4/6 https://www.mhc.tn.gov.in/judis above condition is not complied with by the petitioner for any reason, it is open to the respondents to proceed to recover in accordance with law.
This writ petition stands disposed of. There shall be no order as to costs. Consequently, connected Miscellaneous Petition stands closed.
2024 NCC : Yes / No Index : Yes / No Internet : Yes BTR To 1.The Assistant Commissioner (ST) (FAC), Palayamkottai, Commercial Taxes Buildings, AR Line Road, Tirunelveli, Tamil Nadu-627 002. 2.The Commissioner (Commercial Tax), Office of the Commissioner (Commercial Tax), 4th Floor, Ezhilagam Annex Building, Chepauk, Chennai-600 005. 5/6 https://www.mhc.tn.gov.in/judis MOHAMMED SHAFFIQ
, J.
BTR
2024
6/6 https://www.mhc.tn.gov.in/judis
Reproduced from the public record of the Madras High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.