Tikaram Sharma Vs Joint Commissioner (Calcutta High Court)
Summary: The Calcutta High Court devised an interim workable arrangement concerning a disputed CGST demand of Rs.75,40,424 against Tikaram Sharma, a government contractor working for the State Government. Three garnishee notices dated August 21, 2025 had resulted in restraints over the petitioner’s bank accounts, allegedly preventing payment of labour, contractors and statutory and non-statutory business liabilities. The Revenue submitted that the demand should remain secured because recovery could become difficult if the pending writ petition were ultimately dismissed. Balancing the competing interests, the Court directed the petitioner to require all debtors to deposit amounts payable to him into a specified account maintained with HDFC Bank, Kalimpong Branch. The bank was directed to set apart Rs.75,40,424, and the petitioner was prohibited from operating that account until the full amount was credited and secured. After the disputed demand was set apart, the petitioner could operate the specified account beyond the reserved amount, while all liens and restraints on his other bank accounts would stand released. Accordingly, the Court set aside the three garnishee notices dated August 21, 2025 and directed the petitioner’s debtors to deposit the amounts into the identified account. The Court expressly clarified that the arrangement was interim, without prejudice to the parties’ rights and contentions, and did not express any opinion on the merits of the pending writ petition. I.A. No. CAN 5 of 2026 was disposed of without costs.
FULL TEXT OF THE JUDGMENT/ORDER OF HIGH COURT AT CALCUTTA
Mr. Boudhayan Bhattacharyya, learned advocate appears for the writ petitioner/assessee.
Mr. Ratan Banik, learned advocate (VC) with Mr. Biswaraj Agarwal, learned advocate appears for the revenue.
The writ petitioner has challenged the demand raised by the CGST authority for a total sum of Rs.75,40,424/- through the pending writ petition.
A co-ordinate Bench on December 22, 2025 had directed the parties to file and exchange their respective affidavits in the writ petition. The demand of the revenue would be appearing from annexure P-4 at page 60 to the writ petition. Another co-ordinate Bench on March 27, 2026 passed an interim order to the extent that since revenue did not file affidavit-in-opposition then the writ petitioner was permitted to operate one bank account bearing account no. 50200017830476 maintained with HDFC Bank, Kalimpong Branch (hereinafter, the said bank account) in the manner and mode directed therein after getting a lien for a sum of Rs.3,00,000/-.
Through the instant application the assessee has prayed for quashing of the Garnishee notices all dated August 21, 2025 along with consequential prayer.
Mr. Boudhayan Bhattacharyya, learned advocate for the assessee submits that, the petitioner is a Government contractor who only works for the State Government. He submits that, in view of the issuance of the said Garnishee notices, the bank accounts of the petitioner have been restrained from operation and in effect have been freeze. The petitioner cannot incur its day to day business expenses. The petitioner cannot pay its labours and contractors. The petitioner cannot meet its business liability both statutory and non-statutory, as a result the petitioner has been incurring huge liability towards its creditors and the other statutory authorities where the petitioner has to pay its statutory liability.
Mr. Ratan Banik, learned advocate for the Revenue submits that page 60 from the writ petition would show there has been a total demand for a sum of Rs.75,40,424/- which is under challenge in the pending writ petition. Unless, the said demand is secured during pendency of the writ petition and the bank accounts are allowed to be operated then in the event the writ petition fails on merit, the Revenue will be in a deep trouble to realize the said entire demand and there might be multiplicity of proceedings.
After considering the rival contentions of the parties and on perusal of the materials on record and the demand of the Revenue this Court is of the view that, a workable arrangement can be made which can serve both the Revenue and the petitioner.
Accordingly, the petitioner shall inform all its debtors to deposit the amount payable to the petitioner in the said bank account maintained with the HDFC Bank, Kalimpong branch henceforth. HDFC Bank, Kalimpong branch is directed to set apart the said total sum of Rs.75,40,424/-. So long the said bank account is not credited with the said sum of Rs.75,40,424/- and the same is set apart, the petitioner shall not be permitted to operate the bank account. Once this amount of Rs.75,40,424/- will be credited to the said bank account, the entire amount shall be set apart and then the petitioner shall be permitted to operate the bank account beyond the said sum of Rs.75,50,424/-, which shall remain set apart.
After the said entire amount of Rs.75,40,424/- is set apart and the petitioner shall be permitted to operate the said bank account, all other bank accounts of the petitioner shall be free from any lien and restraint and the petitioner shall also be permitted to operate all the other bank accounts.
In view of the above, the three Garnishee notices all dated August 21, 2025 being annexures B, C and D at pages 17, 18 and 20 to the instant application stand set aside and the debtors of the petitioner are directed to deposit the amounts to the credit of the petitioner, at the said bank account of the petitioner maintained with HDFC Bank, Kalimpong branch.
Once again it is clarified that, only after the entire demand of the Revenue for a sum of Rs.75,40,424/- is set apart, then the petitioner will be permitted to operate its all the bank accounts including the said bank account.
It is also made clear that, this order is merely an interim workable arrangement made without prejudice to the rights and contentions of the parties in the main writ petition and this Court has not expressed any opinion on the contentions of the parties in the pending writ petition.
The application being I. A. No. CAN 5 of 2026 stands disposed of, without any order as to costs.
Parties shall be at liberty to mention the writ petition for enlistment under the heading “Hearing” upon notice to each other.
