Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(AP) 935

IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
R. RAGHUNANDANRAO, T.C.D. SEKHAR, JJ.
V.V.S. Enterprises, Represented By Its Managing Partner Sri Kottada Sankararao, S/o. Sri Appala Swami Naidu – Petitioner
Versus
The State Of Andhra Pradesh, Rep., By Its Principal Secretary To Government, Revenue (CT) Department – Respondent
Writ Petition No.6645 of 2026
Decided On : 15-04-2026

Advocates Appeared:
For the Petitioner: R. Siva Sai Swarup
For the Respondents: GP For Commercial Tax

Section 79 of the GST Act allows tax authorities to recover undisputed tax dues from third parties, such as banks, without prior notice to the defaulter, provided that an assessment order has already been finalized against the taxpayer.

Headnote:(A) Andhra Pradesh Goods and Services Tax Act, 2017 - Section 79(1)(c) - Recovery of tax arrears - Impugned notice issued to bank for recovery of tax - Petitioner challenged notice on grounds of lack of prior notice and lack of authorization to the officer - Court found that Section 79 does not mandate prior notice to the defaulter before recovering dues from third parties (banks), and the officer was duly authorized under a government notification published in the gazette - Assessment order attained finality and remained unchallenged, distinguishing the case from precedents where tax liability was still in dispute - Writ petition dismissed.

Facts of the case:
The petitioner, a registered dealer, was served a notice under Section 79(1)(c) of the APGST Act, 2017, directing their bank to pay outstanding tax dues. The petitioner contends that the respondent authorities did not initiate adjudication under Sections 73/74, failed to provide prior notice, and the issuing officer lacked authorization.

Findings of Court:
The court held that the assessment order dated 17.01.2025 attained finality and the issuance of notice under Section 79 was a valid recovery measure for undisputed tax dues.

Issues: Whether the tax authorities require prior authorization or must provide fresh notice to a dealer before invoking recovery powers under Section 79 of the APGST Act when an assessment order has already attained finality.

Ratio Decidendi: Section 79 does not require prior notice to a defaulting dealer, and when the tax liability has already been determined through an assessment order that remains unchallenged, the authorities may lawfully proceed to recover dues from third parties under the statutory power provided.

Result: Writ petition dismissed.

Judgement Key Points

Key Points: - The petitioner challenges an impugned notice under Section 79(1)(c) of APGST Act, 2017 directing a bank to pay tax dues on behalf of a defaulting dealer. (!) - The Court held that no authorization from a competent authority is required for issuing notices under Section 79, and the notice was issued by the proper officer as per Gazette notification. (!) (!) - The Court noted that Section 79 allows recovery from third parties from whom money is due or may become due to the defaulting dealer, and there is no bar to such recovery without prior notice to the dealer in certain circumstances. (!) (!) (!) - The case distinguished earlier judgments relied upon by the petitioner, stating those did not apply since there was no dispute about the tax liability (the assessment was final and unchallenged). (!) (!) - The Assessment Order dated 17.01.2025 against the petitioner had attained finality and the impugned notice was issued after tax dues remained unpaid for over a year. (!) - The High Court dismissed the writ petition, holding no illegality in issuing the impugned notice under Section 79 and declining relief. (!) - The Gazette notification dated 14.12.2022 identifies the appropriate proper officer (Deputy Assistant Commissioner (ST) – Airport Circle) for exercising powers under Section 79. (!) (!) - The Court emphasized that the Section 79 recovery mechanism is to recover tax arrears from third parties and to credit the amount to the Government accounts. (!) (!) - The petitioner’s request for stay of the impugned notice was rejected as part of the main petition dismissal. (!) - The order closes pending applications; no costs awarded. (!)

Question 1?

Question 2?

Question 3?

Table of Content
1. challenge to tax recovery notice under section 79. (Para 1 , 2)
2. interpretation of section 79 and authority of tax officers. (Para 3 , 4 , 5 , 6)
3. requirement of personal notice when tax liability is fixed. (Para 7 , 8 , 9 , 10 , 11 , 12)
4. dismissal of petition due to existence of final assessment. (Para 13)

COMMON ORDER :

T.C.D. Sekhar, J.

1. The petitioner is a Registered Dealer under GST Act, on the rolls of the 4th respondent. The present Writ Petition is filed questioning the notice dt.05.02.2026 issued under Section 79(1)(c) of APGST Act, 2017, through which the 5th respondent-Bank was directed to pay a sum of Rs.7,54,108/-, which is payable by the writ petitioner towards its tax dues.

2. The counsel for the petitioner would submit that the respondent Tax Authorities, without initiating action of adjudication as provided for under Sections 73 or 74, the impugned notice under Section 79 could not have been issued. He would further submit that before issuing notice under Section 79, the proper officer did not get authorization from the competent authority to initiate such action.

3. For proper appreciation of the case of the petitioner, it is relevant to extract Section 79 of APGST Act, 2017:-

“79. (1) Where any amount payable by a person to the Government under any of the provisions of this Act or the rules made thereunder is not paid, the proper officer shall proceed to recover the amount by one or more of the following modes, namely:-

(a) the proper officer may deduct or may require any other specified officer to deduct the amount so payable from any money owing to such person which may be under the control of the proper officer or such other specified officer;

(b) the proper officer may recover or may require any other specified officer to recover the amount so payable by detaining and selling any goods belonging to such person which are under the control of the proper officer or such other specified officer;

(c) (i) the proper officer may, by a notice in writing, require any other person from whom money is due or may become due to such person or who holds or may subsequently hold money for or on account of such person, to pay to the Government either forthwith upon the money becoming due or being held, or within the time specified in the notice not being before the money becomes due or is held, so much of the money as is sufficient to pay the amount due from such person or the whole of the money when it is equal to or less than that amount;

(ii) every person to whom the notice is issued under sub-clause (i) shall be bound to comply with such notice, and in particular, where any such notice is issued to a post office, banking company or an insurer, it shall not be necessary to produce any pass book, deposit receipt, policy or any other document for the purpose of any entry, endorsement or the like being made before payment is made, notwithstanding any rule, practice or requirement to the contrary;

(iii) in case the person to whom a notice under sub-clause (i) has been issued, fails to make the payment in pursuance thereof to the Government, he shall be deemed to be a defaulter in respect of the amount specified in the notice and all the consequences of this Act or the rules made there under shall follow;

(iv) the officer issuing a notice under sub-clause (i) may, at any time, amend or revoke such notice or extend the time for making any payment in pursuance of the notice;

(v) any person making any payment in compliance with a notice issued under sub-clause (i) shall be deemed to have made the payment under the authority of the person in default and such payment being credited to the Government shall be deemed to constitute a good and sufficient discharge of the liability of such person to the person in default to the extent of the amount specified in the receipt;

(vi) any person discharging any liability to the person in default after service on him of the notice issued under sub-clause (i) shall be personally

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