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TMI Blog2015 (11) TMI 1016X X X X Extracts X X X X X X X X Extracts X X X X ..... id notice to the fourth respondent. The petitioner has also challenged the orders dated 11.9.2015 made by the fourth respondent under section 44 of the Act attaching the bank accounts of the petitioner in relation to demands relating to assessment years 2009-10, 2011-12, 2012-13 and 2013-14. 4. The petitioner is a company engaged in trading of Thermoplastic Road Marking Material and is registered under the Gujarat Value Added Tax Act, 2003 (hereinafter referred to as "the Act"). The petitioner, during the period under consideration, was receiving goods from the manufacturer under Form C and the dealer was re-selling the goods in Gujarat without carrying out any further process and accordingly, classified the goods under the Gujarat VAT Schedule II vide entry 42A at Entry No.145 as per notification dated 31.3.2006. The petitioner filed the monthly returns for the period in question and the returns were assessed by the Commercial Tax Officer (3) Unit 22 (respondent No.4 herein) in the year 2012 without demanding any differential duty. Subsequently, the assessment order was subjected to reassessment under section 35(1) by the fourth respondent by a notice dated 12.5.2014. The petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 made by the fourth respondent under section 44 of the Act and such permission came to be granted 8. Mr. S. N. Soparkar, Senior Advocate, learned counsel with Mr. Dhaval Shah, learned advocate for the petitioner vehemently assailed the action of the respondents by submitting that very drastic action of attaching the bank accounts of the petitioner has been taken by the respondents which was not warranted in the facts and circumstances of the case. It was pointed out that on both the occasions in relation to year 2010-11 as well as subsequently in relation to other assessment years, three bank accounts of the petitioner have been sought to be attached. In each of the notices, the entire demand is sought to be recovered through each bank account. It was submitted that in case each bank account of the petitioner had sufficient funds, the respondents would have recovered the entire amount thrice over. The attention of the court was invited to the notice dated 11.9.2015 issued by the fourth respondent, whereby the petitioner was called upon to pay the amount under the demand notice within a period of three days together with interest at 18%. It was submitted that despite such notice h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner was going to file an appeal within the period of limitation, the authorities are expected not to take any coercive action till the stay application comes up for hearing before the Tribunal for which the petitioner shall make an endeavour before the Tribunal for early hearing of the application. Reliance was also placed upon an unreported decision of this court in the assessee's own case rendered on 28.11.2014 in Special Civil Application No.12592 of 2014. 9. Opposing the petition, Ms. Maithili Mehta, learned Assistant Government Pleader reiterated the contentions of the affidavit-in-reply filed on behalf of the respondents No.3 and 4. It was submitted that the petitioner had been issued notice in Form 305 as contemplated under rule 27 of the Gujarat Value Added Tax Rules, 2006 (hereinafter referred to as "the rules") calling upon the petitioner to pay the amount thereunder within a period of 30 days from the date of service of such notice. However, the petitioner having failed to pay such amount within the period stipulated in the notice, the fourth respondent was wholly justified in resorting to the provisions of section 44 of the Act for recovery of such amount. It was fur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attached. A perusal of the orders under section 44 of the Act dated 11.9.2015 issued to each of the above referred banks shows that each bank has been directed to send to the fourth respondent Pay Order/Demand Draft of Rs. 5,43,37,080/- plus interest at 18%. 11. It may be noted that on 11.9.2015 in relation to the above referred demand of Rs. 5,43,37,080/- with interest, the fourth respondent had issued notice to the petitioner calling upon it to pay the amount under the demand notice within a period of three days, failing which, he would initiate recovery proceedings. However, without waiting for the period of three days as stated in the notice dated 11.9.2015 to elapse, the fourth respondent, on the very same day, has attached the above three bank accounts in relation to the demand notice pertaining to the above referred years. 12. It may be noted that in relation to each of the assessment years, the petitioner has filed appeals and the stay applications, all of which are pending before the first appellate authority for consideration. However, on the one hand, the first appellate authority is not taking any decision on the stay applications and on the other hand, the fourth res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. With the passage of time a third element was introduced, namely, of procedural reasonableness because the main objective of the requirement of rule of natural justice is to promote justice and prevent its miscarriage. Therefore, when the legislature confers power in the State Government to be exercised in certain circumstances or eventualities, it would be right to presume that the legislature intends that the said power be exercised in the manner envisaged by the statute. If the statute confers drastic powers it goes without saying that such powers must be exercised in a proper and fair manner. Drastic substantive laws can be suffered only if they are fairly and reasonably applied. In order to ensure fair and reasonable application of such laws courts have, over a period of time, devised rules of fair procedure to avoid arbitrary exercise of such powers." 16. In the facts of the present case, it is not the case of the respondents that the petitioner is a fly by night operator or that the petitioner has closed down its business warranting exercise of powers under section 44 of the Act in such a drastic manner. When the petitioner had already preferred an appeal with a stay app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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