2018 (11) TMI 1657 - HC - VAT and Sales Tax

Freezing of Bank Account - non-release the payment from the account as the petitioner had stood surety of a dealer - change of status of the company - HELD THAT - The present petition disposed off by directing respondent No.2 to take a decision on the representation dated 12.10.2018 (Annexure P-6), in accordance with law by passing a speaking order and after affording an opportunity of hearing to the petitioner within a period of 15 days from the date of receipt of the certified copy of the order.

Summary

Issues:
1. Petition for writ of certiorari to quash directions not to release payment and for mandamus to remove lien on account.
2. Change in account status due to government order, outstanding dues of a dealer.
3. Petitioner's representations to respondents and lack of action.
4. Relief sought in the writ petition.

Analysis:

Issue 1: The petitioner sought a writ of certiorari to quash directions issued by respondent No.2 to respondent No.3 not to release payment from the petitioner's account and a writ of mandamus to remove the lien on the account. The petitioner is engaged in manufacturing and has an overdraft account with respondent No.3 for managing working capital. The petitioner received communication regarding the freeze on the account due to outstanding dues of a dealer against which the petitioner had stood surety. Despite representations to respondents, no action was taken.

Issue 2: The petitioner's account status was changed to debit freeze based on a government order due to outstanding dues of a dealer for VAT and CST. Respondent No.3 informed the petitioner that the status change was in accordance with the direction received from respondent No.2. The petitioner made representations to both respondents to withdraw the direction and remove the lien, but no response was received. A complaint was also made against respondent No.2 at the Chief Minister Window.

Issue 3: The petitioner's counsel highlighted the lack of action on the representation made to respondent No.2 seeking relief. The court, after hearing the petitioner's counsel, decided to dispose of the petition by directing respondent No.2 to make a decision on the representation within 15 days, in accordance with the law, by passing a speaking order after affording an opportunity of hearing to the petitioner.

Issue 4: Without expressing any opinion on the merits of the case, the court provided relief by directing respondent No.2 to decide on the petitioner's representation within 15 days, following due process and providing an opportunity for the petitioner to be heard.