Case Details: Galaxy International vs. Union of India - [2025] 176 taxmann.com 35 (Bombay)
Judiciary and Counsel Details
- M.S. Sonak & Jitendra Jain, JJ.
- Prakash Shah, Sr. Adv., Brijesh Pathak & Dulraj Jain for the Petitioner.
- Jitendra B. Mishra, Ms Sangeeta Yadav & Rupesh Dubey for the Respondent.
Facts of the Case
The petitioner was subjected to a tax recovery action under section 79(1)(c) of the CGST Act/ Maharashtra GST Act through an impugned notice issued solely to the petitioner’s bank for recovery of tax dues of a person in default. The petitioner submitted that no notice under section 79(1)(c) was ever served upon them, and the impugned notice was not addressed to them at all. It was contended that this omission deprived the petitioner of the statutory opportunity to prove to the satisfaction of the officer issuing the notice that no amount was due and payable by them to the person in default. On this basis, the petitioner challenged the validity of the recovery proceedings, and the matter was accordingly placed before the Bombay High Court.
High Court Held
The Bombay High Court held that under section 79(1)(c), it is mandatory for the officer to serve a notice upon the person from whom recovery is proposed, in order to enable such person to establish that no sum is owed to the person in default. Since no such notice was admittedly issued to the petitioner, the impugned action was found to be in breach of statutory requirements and principles of natural justice. On this short but decisive ground, the recovery notice issued only to the bank was quashed and set aside.
List of Cases Reviewed
- SJR Prime Corporation (P.) Ltd. v. Superintendent of Central Tax [2024] 168 taxmann.com 544/107 GST 182/92 GSTL 154 (Karnataka) (para 11) followed
List of Cases Referred to
- SJR Prime Corporation (P.) Ltd. v. Superintendent of Central Tax [2024] 168 taxmann.com 544/107 GST 182/92 GSTL 154 (Karnataka) (para 11).
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