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Interim Order Stayed Notice Issued Under Section 38 of MVAT Act and Lapsed Provisional Attachment of Demat Accounts
Interim Order Stayed Notice and Lapsed Attachment in MVAT Act Case
Interim Order Stayed Notice and Lapsed Attachment in MVAT Act Case
The case involves a notice issued to the petitioner under Section 38 of the MVAT Act, alleging MVAT liability against a company of which the petitioner was a director. The petitioner’s counsel argued that the liability for the period after the petitioner’s resignation should not be attributed to him. The court found that the provisional attachment of the demat accounts had lapsed and stayed the impugned notice issued under Section 38 of the MVAT Act against the petitioner.
Case Name:
Ajay Kumar Kaushal vs. The State of Maharashtra
Key Takeaways:
- The provisional attachment of the demat accounts of the petitioner and his family members has lapsed.
- The impugned notice issued under Section 38 of the MVAT Act against the petitioner has been stayed.
- The respondents are directed to file a reply affidavit to the petition within a week.
Synopsis:
In this case Ajay Kumar Kaushal as the petitioner and the State of Maharashtra as the respondent. The case revolves around a notice issued to the petitioner by the Sales Tax Officer, Nodal Division Mumbai-2, under Section 38 of the Maharashtra Value Added Tax Act, 2002 (MVAT Act). The notice pertains to a MVAT liability against Ananta Impex Pvt. Ltd. and/or Mapro Ventures Ltd., of which the petitioner is alleged to be a director. Additionally, the demat accounts of the petitioner and his family members with ICICI Bank were frozen in connection with the same matter.
The petitioner’s counsel argued that the petitioner had resigned as a director of Ananta Impex Pvt. Ltd. on 20th March 2017 and that the MVAT liability for the period after his resignation should not be attributed to him. The counsel also pointed out that the returns for the relevant periods were filed after the petitioner’s retirement, and the petitioner had no involvement in the events that occurred after his resignation, including the filing of revised returns.
The court, after considering the arguments from both sides, found that the provisional attachment of the demat accounts had automatically lapsed by operation of law. Regarding the impugned notice issued under Section 38 of the MVAT Act, the court opined that the notice could not have been issued to the petitioner, who was a former director and not a registered dealer to whom such a notice could have been addressed. The court also noted that the respondents had not verified the facts before issuing the notice and had proceeded under the impression that the petitioner continued to be a director of Ananta Impex Pvt. Ltd.
As an interim order, the court stayed the impugned notice issued under Section 38 of the MVAT Act against the petitioner and ordered that the provisional attachment of the demat accounts of the petitioner and his family members had lapsed. The respondents were directed to file a reply affidavit to the petition within a week, and the matter was listed for a later date.
FAQ:
Q1: What was the outcome of the case?
A1: The court stayed the impugned notice issued under Section 38 of the MVAT Act against the petitioner and ordered that the provisional attachment of the demat accounts of the petitioner and his family members had lapsed.
Q2: What was the petitioner’s argument?
A2: The petitioner’s counsel argued that the liability for the period after the petitioner’s resignation should not be attributed to him and that he had no involvement in the events that occurred after his resignation.
Q3: What action was directed to be taken by the respondents?
A3: The respondents were directed to file a reply affidavit to the petition within a week.
