Rajeev Jugalkishor Mundra Vs Commissioner of Goods and services Tax Maharashtra & Anr (Bombay High Court)
The case of Rajeev Jugalkishor Mundra Vs Commissioner of Goods and Services Tax, Maharashtra & Anr involved the attachment of Demat accounts of the petitioner, who had resigned as a non-executive director of Vistaar Logistic Pvt. Ltd. in 2019. The Maharashtra tax authorities froze his accounts in 2024 due to alleged unpaid GST liabilities of the company. The petitioner challenged this action, arguing that he had no role in the company’s financial affairs after his resignation and that the attachment was done without due process. The Bombay High Court reviewed the matter, highlighting that there was no evidence of proceedings under the relevant MGST Act provisions to justify the attachment. The petitioner cited the Prasanna Karunakar Shetty Vs. State of Maharashtra case to support his argument that such an action required adherence to principles of natural justice.
The tax department defended its action under Section 83 of the MGST Act, asserting that the attachment was provisional and that a notice under Section 89 was being issued. However, the court found that the attachment lacked legal backing since no proceedings had been initiated under the required chapters of the MGST Act. Upon the court’s intervention, the tax department agreed to withdraw the attachment and issue notices under Section 89 while ensuring the petitioner received a fair opportunity to respond. The court made the rule absolute, granting relief to the petitioner and stating that any further action must comply with due process. This ruling reaffirmed that tax authorities must follow legal procedures before enforcing financial restrictions.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
