2016 (7) TMI 713 - HC - VAT and Sales Tax

Blocking TIN Number of the petitioner-company from accessing the facility i.e. the website of the respondents- authorities (www.tgct.gov.in) for issuing statutory C Declaration Forms/Way-bills to its sellers - Held that - even if any tax is due from the petitioner, denial of the way-bills is not the proper way to recover the tax. Having regard to the facts and circumstances of the case and following the judgment dated 12.03.2014 passed by this Court in W.P.No. 39097 of 2013, we are of the considered view that the action of the respondent-sauthorities in blocking the TIN Number of the petitioner-company from accessing the facility i.e. the website of the respondents- authorities (www.tgct.gov.in) for issuing the statutory C Declaration Forms / Way-bills to its sellers even if tax is due from the petitioner, is not proper.

Summary

Issues:
Petitioner seeks relief for blocking TIN number access for issuing statutory forms; Allegation of illegal, arbitrary action by respondents; Request for unblocking TIN number and issuing statutory forms to sellers; Dispute over non-acceptance of online request for forms; Non-consideration of representation by respondents; Legal action initiated for recovery of tax arrears; Petitioner's contention of prompt payments made earlier; Reference to past court judgments; Respondents' argument of petitioner being a tax defaulter; Department's authority to block TIN number; Interpretation of rules regarding issuance of way-bills; Supreme Court's stance on coercive tax recovery methods.

Analysis:
The petitioner, a registered dealer under tax laws, filed a writ petition seeking relief against the respondents for blocking their TIN number access to issue statutory "C" Declaration Forms/Way-bills to sellers. The petitioner, facing financial difficulties since 2003, had fallen behind on tax payments, leading to legal action for recovery of dues. Despite earlier prompt tax payments, the respondents blocked the TIN number without notice, hindering online form issuance. The petitioner's representation to unblock the TIN number was ignored, prompting the petition. The petitioner argued the blocking was arbitrary, citing a court precedent allowing form issuance despite tax arrears.

The respondents contended that the petitioner's tax default since 2003 justified the TIN block and recovery actions, opposing the petition's claims. Upon review, the court found the factual aspects undisputed, focusing on the denial of way-bills due to the blocked TIN number. Citing past judgments, the court emphasized that denial of way-bills for tax recovery was improper, echoing the Supreme Court's stance against coercive tax collection methods. Relying on precedent, the court held that blocking TIN access for form issuance, even if tax was due, was not justified. Consequently, the respondents were directed to consider the petitioner's representation promptly and act in accordance with the law.

In conclusion, the writ petition was partly allowed, with no costs imposed. The court's decision aligned with past rulings and legal principles, emphasizing fair treatment despite tax arrears. Any pending petitions related to the case were deemed moot following the judgment.