M/S Shri Krishna Agencies vs. The Assistant Commissioner Of Central Excise (Range-92)

Held

The Court held that the respondent's inaction post the issuance of the Discharge Certificate dated March 11, 2020, was unacceptable. The Discharge Certificate, issued under the Sabka Vishwas Scheme, 2019, represented a complete settlement of the petitioner's tax liabilities. The Court found that the respondent had failed to take the necessary steps to defreeze the petitioner's bank account and withdraw its lien on the LIC policy for an unreasonable period of over three months. The respondent's submission that the file was under process with the Competent Authority, without providing any timeline, was deemed insufficient. The Court directed the respondent to clear the petitioner's file and complete the necessary actions, including defreezing the bank account and releasing the lien on the LIC policy, within three working days from the date of the order. The petitioner was granted liberty to approach the Court again if the grievance persisted.

Facts

The petitioner, M/s Shri Krishna Agencies, is aggrieved by the respondent's inaction in defreezing its bank account and releasing a lien on an LIC policy, despite receiving a Discharge Certificate dated March 11, 2020. The dispute originated from a notice to show cause dated July 26, 2007, concerning CENVAT credit of Rs. 1,74,10,417/- and a demand of Rs. 1,71,05,157/-. An order dated October 22, 2008, confirmed the demand and imposed penalties. The petitioner's appeal was dismissed for non-compliance with pre-deposit. Subsequently, the petitioner availed the Sabka Vishwas Scheme, 2019, settling the dispute for Rs. 1,02,63,094.20, for which a Discharge Certificate was issued. The petitioner's bank account was frozen on May 26, 2010, and a lien was placed on the LIC policy in 2013.

Key Issues

1. Whether the respondent has failed to act upon the Discharge Certificate dated March 11, 2020, issued under the Sabka Vishwas Scheme, 2019, by not defreezing the petitioner's bank account and releasing the lien on the LIC policy? (Question of fact and law). Petitioner's contention: The petitioner argued that post the issuance of the Discharge Certificate, which signifies a full and final settlement of tax dues, the respondent has failed to take consequential actions, specifically defreezing the bank account and releasing the lien on the LIC policy, for over three months. This inaction is causing prejudice to the petitioner's business operations. Respondent's contention: The respondent acknowledged that the petitioner's file has been put up to the Competent Authority and is under process. However, the respondent could not provide a timeline for the completion of the process or when the file was initially submitted to the Competent Authority.