SPNN Business Services Pvt. Ltd. Vs Commissioner of Central Tax (GST) (Delhi High Court)
Hon’ble Delhi High Court directed the Revenue to permit the petitioner company to collect a sum of Rs. 2 crores from bank accounts provisionally attached by the GST Dept, to pay salaries of employees.
Facts:
The Commissioner of Central Tax (GST), Delhi (“the Respondent”) attached 11 bank accounts of SPNN Business Services (P.) Ltd. (“the Petitioner”) under provisions of Section 83 of Central Goods and Services Tax Act, 2017.
The Petitioner had filed its objections qua the order of attachment, which were rejected. In this backdrop the Petitioner has approached the Hon’ble Delhi High Court for interim directions for lifting the provisional attachment so that the subject bank accounts could become operable, and the Petitioner would not only be able to pay the salaries and other statutory dues concerning its employees but is also able to pay the amounts claimed by the Respondents.
Held:
The Hon’ble Delhi High Court in W.P.(C) NO. 2435 OF 2021 dated March 05, 2021 directed the Respondent to permit the Petitioner to collect a sum of Rs. 2 crores from bank accounts provisionally attached by the GST Dept, to pay salaries of employees. Further, directed the Petitioner to deposit the balance amount with the Respondent.
FULL TEXT OF THE HIGH COURT JUDGMENT
1. Pursuant to the order dated 03.03.2021; two affidavits have been filed on behalf of the petitioner-company.
1.1 The first affidavit has been filed by, one, Mr. Navneet Singh, who claims to be the director of the petitioner-company. This affidavit is dated 03.03.2021. The affidavit is accompanied by Annexure A-1, which bears out the details of the employees engaged by the petitioner-company.
1.2. The details include the name, the Aadhaar card number, the banker with whom the employees have maintained their accounts, the IFSC code details and the bank account number. We are told that there are 14,600 employees whose details have been given in Annexure A-1.
1.3 Insofar as the other affidavit is concerned, it is sworn by Mr. Prateek Jha, who is also a director in the petitioner-company. This affidavit is also dated 03.03.2021. In paragraph 3 of the affidavit, Mr. Prateek Jha has averred that five immovable properties, referred to in the order dated 03.03.2021, are free from encumbrances and/or charge.
1.4 Furthermore, Mr. Jha has gone on to aver in paragraph 4 of the very same affidavit that he undertakes to deposit the original title deeds of the said properties upon a direction being issued by the Court in that behalf.
2. The concern of the Court, presently, is with regard to the employees engaged by the petitioner-company. Because of the provisional attachment ordered by the respondents on 09.02.2021, 11 bank accounts of the petitioner-company have become inoperable.
2.1. It appears that the petitioner-company had filed its objections qua the order of attachment, which were rejected on 18.02.2021. It is in this backdrop that the petitioner-company has approached this Court for interim directions for lifting the provisional attachment so that the subject bank accounts could become operable and the petitioner-company is not only able to pay the salaries and other statutory dues concerning its employees but is also able to pay the amounts claimed by the respondents.
3. It is not in dispute that the respondents have not carried out an assessment, as yet. It is also not in dispute that the petitioner-company has not made a self-assessment of the tax dues, if any, payable by it.
3.1. As noticed in our order dated 03.03.2021, the cumulative amount outstanding as on that date as per the respondents is Rs.20.22 crores which includes the principal amount of Rs.17.26 crores and interest amounting to Rs.2.96 crores.
3.2. We are informed, [and this is something which Mr. Satish Aggarwala, who appears on behalf of the Revenue, does not dispute] that the cumulative amount which the respondents claimed prior to 03.03.2021 was approximately Rs.24,96,42,318/-. The petitioner-company, we are told, has paid Rs.7.70 crores to the respondents prior to our order dated 03.03.2021. It is on account of this payment that the principal liability got scaled down to approximately Rs. 17.00 crores.
3.3. As noticed above, the interest component, which is, included in Rs.20.22 crores is Rs.2.96 crores. Thus, having regard to the aforesaid circumstances, we are inclined to issue the following directions:
(i) The provisional attachment vis-à-vis the 11 bank accounts, the details of which are given hereafter shall stand lifted:
