Deputy Commissioner St & Ors Vs Wingtech Mobile Communications (India) Pvt. Ltd. & Anr (Supreme Court of India)
No attachment of bank account/ restraining funds of taxpayers after 10% pre-deposit payment for appeal filed
In Deputy Commissioner ST & Ors. v. Wingtech Mobile Communications (India) Pvt. Ltd., the Supreme Court of India clarified the scope of Section 107(6) and (7) of the CGST Act, 2017 concerning appellate pre-deposits and attachment of bank accounts. The case arose when the Revenue attached the bank accounts of Wingtech Mobile Communications following a GST assessment order, despite the assessee having made the mandatory 10% pre-deposit required to file an appeal under Section 107(6). The assessee contended that continued attachment of its accounts was unlawful, while the Revenue argued that attachment could persist to secure the remaining disputed amount. The Andhra Pradesh High Court had earlier granted relief, permitting the assessee to operate its bank accounts, observing that the pre-deposit had been made and recovery of some amounts was sufficient to secure the Revenue’s interest. The Supreme Court upheld the High Court’s order, holding that once the mandatory pre-deposit is made, the law does not authorise continued attachment or restraint of bank accounts for the balance demand. The Court noted that the assessee’s undertaking to preserve the disputed amount, pending further proceedings, is sufficient, and dismissed the Special Leave Petition, affirming the statutory protection intended under Sections 107(6) and 107(7). The judgment reinforces that the pre-deposit mechanism effectively suspends recovery of the balance amount during the pendency of appeals, ensuring that the Revenue cannot bypass the statutory stay once the pre-deposit is made. This ruling provides clarity and safeguards for taxpayers filing appeals under the CGST framework, ensuring that recovery measures are proportionate and consistent with legislative intent.
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