Case Details: Subir Ghosh vs. Deputy Commissioner (ST) (FAC) (2025) 36 Centax 294 (Mad.)
Judiciary and Counsel Details
- C. Saravanan, J.
- Shri P.V. Sudakar, for the Petitioner.
- Shri V. Prashanth Kiran, Govt. Adv., for the Respondent.
Facts of the Case
The petitioner, a former Director of a GST-registered company, challenged the attachment of his personal bank account issued through DRC-13 for recovery of GST dues assessed against the company. The jurisdictional officer proceeded on the basis that amounts standing in the petitioner’s personal account could be recovered towards the company’s arrears, though the company had independently challenged the assessment order in a separate writ petition. The petitioner submitted that he had resigned as Director and contended that recovery from a former director’s personal assets could be undertaken only after adjudicating director liability under Section 79 read with Section 89 of the CGST Act and the Tamil Nadu GST Act, and Rule 145 of the CGST Rules and the Tamil Nadu GST Rules. The petitioner sought withdrawal of the attachment and an opportunity to submit a representation before any steps were initiated against him. The matter was accordingly placed before the High Court.
High Court Held
The High Court held that recovery of GST dues of a company from the personal assets of a former director required prior adjudication determining such director’s liability under the applicable statutory framework. The Court observed that, in the absence of such adjudication, the DRC-13 issued to the petitioner’s bank could not operate as a recovery notice and was liable to be treated only as a show cause notice. It directed that the petitioner be permitted to file a detailed representation within thirty days and that the competent officer adjudicate the issue and pass a speaking order after granting a personal hearing. The Court further directed that, pending completion of this exercise, the attachment of the petitioner’s bank account stand lifted, subject to the condition that no unusual transfers take place.
