Amount debited from bank of assessee – Gross abuse of power – HC

Pradeep Kumar Siddha Vs Union of India & Ors. (Bombay High Court)

HC held that We fail to understand, prima facie, as to how the authorities get this power to take away amount from anybody’s account without account holder’s permission or even after taking away the money, they would not even consider it necessary to inform the account-holder that money from their account has been debited. This is nothing but high handedness and gross abuse of power.

HC directed the department to deposit the entire amount of Rs. 62,32,400/- with the Registrar (Judicial-I) of this Court on or before 28.07.2022 failing which this court may issue contempt notice against them.

It is to be noted that earlier court directed department to unfreeze the account maintained by petitioner with Axis Bank. It is petitioner’s case that on 20.05.2022, respondents took away Rs. 62,32,400/- from its Axis Bank account and it has been transferred by the bank to respondents by way of RTGS.

FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT

1. On 02.05.2022, in an earlier petition that was filed by petitioner being writ petition No. 8915 of 2021, the court directed respondents to unfreeze the account maintained by petitioner with Axis Bank. Petitioner states that notwithstanding the order, Axis Bank did not unfreeze the account. Axis Bank complied with the order after petitioner, vide its advocate’s email dated 13.05.2022, threatened contempt action against Axis Bank.

2. It is petitioner’s case that on 20.05.2022, respondents took away Rs. 62,32,400/- from its Axis Bank account and it has been transferred by the bank to respondents by way of RTGS. Mr. Pathak states that no instructions to debit the amount has been given by the account-holder to Axis Bank to transfer the amount to the account of GST authorities.

3. To a query put by the court, Ms. Bharucha, on instructions, from Mr. Sanjay Prakash Mathur, Superintendent, CGST, Thane Commissionerate states that after the amount was debited, respondents never addressed any communication to petitioner that the amount has been debited from his account. Ms. Bharucha’s case is that petitioner, even after the order was passed by the court, did not co-operate and therefore, respondent Nos. 1 / 2 got the amount debited by Axis Bank from petitioner’s account.

4. We fail to understand, prima facie, as to how the authorities get this power to take away amount from anybody’s account without account holder’s permission or even after taking away the money, they would not even consider it necessary to inform the account-holder that money from their account has been debited. This is nothing but high handedness and gross abuse of power.

5. Respondent No. 2 is directed to deposit the entire amount of Rs. 62,32,400/- with the Registrar (Judicial-I) of this Court on or before 28.07.2022 failing which this court may issue contempt notice against respondent No. 2.

6. Petitioner has also annexed an instruction received bearing F. No. GST/INV/Instructions/2022-23 dated 25.05.2022 in which instructions have been given to all the officers not to use force or coercion against any taxpayer and in case of wrongdoing on the part of tax officer, strict disciplinary action as per law may be taken against the officers.

7. The concerned officer who instructed the bank to debit the amount of petitioner shall file his personal affidavit explaining therein under what authority of law that he got removed the money from petitioner’s bank account or directed the bank to debit the bank account and why did he do it without even informing petitioner even after giving instructions to the bank. The officer is put to notice that this Court may even consider taking action against the officer if it is not satisfied with the explanation. We are making these observations because there have been many matters where the taxpayers account is frozen and the taxpayers come to know only from the bank but after giving instructions to freeze the accounts, the authorities are not even bothering to inform the account-holders that it has given such instructions. This according to us is nothing but oppressing a taxpayer by misusing their position and amounts to harassment of all taxpayers.

8. The affidavit shall be filed and copies served on or before 25.07.2022. Rejoinder, if any, to be filed and copies served by 3.00 p.m. on 29.07.2022.

9. Stand over to 1^st August, 2022.