Nd Enterprise vs. State Tax Officer

Facts

The petitioner, ND Enterprise, through Dharmeshkumar Thakorlal Thakkar, filed a writ petition before the High Court of Chhattisgarh at Bilaspur. The petitioner's conveyance was seized by the Revenue on December 23, 2025. Subsequently, an interim order was granted by the High Court on February 9, 2026, leading to the release of the vehicle upon furnishing a bank guarantee of Rs. 8.39 lacs. The petitioner had also preferred an appeal before the Commissioner Appeals against an order dated January 19, 2026, passed under Section 129 of the State Goods and Services Tax Act, and had deposited 25% of the tax penalty. The petitioner sought quashing of the order dated January 19, 2026, and the release of the bank guarantee.

Held

The Court considered the limited prayer made by the petitioner for the release of the bank guarantee. It was noted that the petitioner's conveyance was seized and later released upon furnishing a bank guarantee of Rs. 8.39 lacs pursuant to an interim order of the High Court. An appeal filed by the petitioner before the Commissioner Appeals is pending, and 25% of the tax penalty has been deposited. The Court directed respondent No. 2 to release the bank guarantee of Rs. 8.39 lacs. However, in lieu of the bank guarantee, the petitioner was directed to furnish a surety of a like sum to the satisfaction of respondent No. 2. The final decision regarding the seized conveyance and other related matters was made subject to the final outcome of the appeal pending before the Commissioner Appeals. No issue was expressly left undecided.

Key Issues

1. Whether the High Court should direct the release of the bank guarantee furnished by the petitioner, considering the pendency of an appeal before the Commissioner Appeals? Petitioner's contention: The petitioner argued that the conveyance was seized, and subsequently released upon furnishing a bank guarantee of Rs. 8.39 lacs pursuant to an interim order. They had also preferred an appeal before the Commissioner Appeals and deposited 25% of the tax penalty. The petitioner prayed for the disposal of the writ petition with a direction to the respondent No. 2 to release the bank guarantee of Rs. 8.39 lacs. Revenue's contention: The State/respondents opposed the prayer, submitting that the vehicle was seized due to the petitioner's failure to produce relevant documents. They stated that the release of the bank guarantee would be decided by the Commissioner Appeals, before whom the petitioner's appeal is pending. Therefore, the prayer made by the petitioner should not be allowed.