The Service Tax Department issued a show cause notice in November, 2012 to Anmol Logistics Service Ltd. for demanding service tax amounting to ₹5 crore. A reply to show cause notice was filed by the company in January, 2

The Service Tax Department issued a show cause notice in November, 2012 to Anmol Logistics Service Ltd. for demanding service tax amounting to ₹5 crore. A reply to show cause notice was filed by the company in January, 2013. The Department has issued an order under section 87(b) of the Finance Act, 1994 freezing all the bank accounts of the company. The company filed a writ petition contending that the Department has no power to freeze bank accounts for the amount which is pending final adjudication. On the other hand, the Department has submitted that the service tax had been recovered by the company on behalf of the Revenue and the company is merely a trustee to hold the amount and this amount is due and payable by the company. Therefore, the adjudication is a mere formality and even provisional adjudication is good enough to invoke the provisions of section 87 of the Finance Act, 1994. The Department has further contended that if the order is set aside, the company would withdraw the entire amount from the bank account and Department would have no remedy to recover the same. Examine whether the contention of the company is legal with the help of a decided case law.