Dakshin Haryana Bijli Vitran Nigam vs. Union Of INDIA And Ors
Held
The Court held that there was no warrant for initiating recovery proceedings under the given circumstances. The reasoning was that the petitioner had challenged the recovery proceedings, an appeal was pending, and the statutory period for automatic stay of recovery under Section 107(7) of the Central GST Act/Haryana, 2017, had not expired. The respondents' failure to dispute these facts further supported the petitioner's position. The Court found that the issue of whether any amount was due had not yet been crystallized. Consequently, the petition was allowed, and a direction was issued to the Appellate Authority to decide the pending appeal. Only after the appeal is decided would the final determination of any outstanding amount be made.
Facts
The petitioner, Dakshin Haryana Bijli Vitran Nigam, filed a writ petition challenging a notice dated May 17, 2021, issued under Section 79 of the GST Act by respondent No. 2 to the petitioner's bank (respondent No. 4). The notice directed the bank to pay Rs. 1,27,58,375/- held for the petitioner, failing which the bank would be deemed a defaulter. The petitioner argued that recovery proceedings should not be initiated while an appeal is pending and within the statutory period for automatic stay. The respondents did not dispute the applicability of Section 107(7) of the Central GST Act/Haryana, 2017, nor the pendency of the appeal.
Key Issues
1. Whether recovery proceedings can be initiated against the petitioner's bank (respondent No. 4) by issuing a notice under Section 79 of the GST Act when an appeal filed by the petitioner is pending and the period for automatic stay of recovery under Section 107(7) of the Central GST Act/Haryana, 2017, has not expired. Petitioner's contention: The petitioner argued that no notice can be issued to its bank for recovery of any amount when the recovery proceedings themselves are under challenge and an appeal is pending. They relied on the principle that recovery is stayed during the pendency of an appeal. Revenue's contention: The respondents did not dispute the applicability of Section 107(7) of the Central GST Act/Haryana, 2017, and did not dispute that the appeal was pending. They did not present any argument against the petitioner's claim that recovery proceedings were unwarranted.
Sections Cited
Section 79, Section 107(7)
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 108 CWP-13487-2021(O&M) CORAM: HON'BLE MR. JUSTICE AJAY TEWARI
HON'BLE MR. JUSTICE VIKAS BAHL Present: Mr. K.L. Goyal, Sr. Advocate with Mr. Navdeep Monga, Advocate for the petitioner. **** AJAY TEWARI, J.(Oral)
This writ petition has been filed under Articles 226/227 of the Constitution of India for quashing of notice dated 17.05.2021 (Annexure P-7) issued under Section 79 of the Act by respondent No.2 to the petitioner's Bank (respondent No.4) asking them to make the payment of Rs. 1,27,58,375/- withheld by it in respect of petitioner, failing which, the respondent No.4 would be deemed to be a defaulter despite the fact that there was automatic stay of recovery during the pendency of the appeal and the period of three months was not yet expired as on the date of notice for recovery of amount.
Learned senior counsel for the petitioner has argued that the petitioner has challenged the recovery proceedings and therefore no notice can be issued to the petitioner's bank i.e. respond
The judgment continues below.
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