By TIOL News Service

NEW DELHI, JAN 27, 2015: AN order-in-original was passed by the Commissioner, Goa on 28.11.2014 confirming a Service Tax liability against the appellant.

This order was received by the appellant on 01.12.2014 and an appeal was filed before the CESTAT on 13.01.2015 by making a pre-deposit u/s 35F of the CEA, 1944, of 7.5% of the Service Tax demand confirmed.

Despite such compliance, the Deputy Director, DGCEI, Goa wrote a letter to the appellant's bankers namely HDFC, SBI and Corporation Bank to remit the amounts lying in balance in the account of the appellant in order to credit the same with the Government exchequer against the dues.

Pursuant to the said communication, the banks froze the accounts and were not allowing the appellant to operate the accounts for their day-to-day activities/functioning.

When this matter was mentioned before the CESTAT on 13.01.2015, the Bench had directed the office of the authorized representative to inform the Commissioner concerned not to take any coercive action.

The AR submitted that his office had communicated to the Dy. Director, DGCEI on 13.01.2015 itself informing about the Bench's direction.

Finding that there was not much development on the issue, the appellant made an oral plea before the Bench on 19.01.2015 and sought urgent intervention of the Bench in the matter.

The Bench observed -

"3. After considering the submission made by both sides, we find that the impugned order has been passed on 28.11.2014 and received by the appellant on 01.12.2014. Aggrieved by such an order, the appellant preferred and appeal before this Bench which has been numbered as ST/85150/15-Mum and the appellant has complied with the mandatory requirement of depositing of 7.5% of the total duty liability. In our considered view and as also statutorily once mandatory deposit of 7.5% has been made, there is no reason for recovery of any further amount from the appellant and the action of the Dy. Director, DGCEI seems to be beyond the scope of law. In our view, there is no need to freeze the account of the appellant as long as the appeal is pending before this Bench. Accordingly, we direct the lower authorities, specially the Dy. Director, DGCEI, Goa to defreeze the account forthwith by issuing appropriate instructions to the appellant's bankers."

The order was issued by Dasti.

In passing: Hopefully, the DGCEI will do the needful else they may be hauled for contempt. Harassment by any other name, will not smell sweet…

(See 2015-TIOL-193-CESTAT-MUM)