2019 (10) TMI 666 - HC - GST

Provisional attachment of property - section 83 of the State Goods and Services Tax/Central Goods and Services Tax Act, 2017 - HELD THAT - Issue Notice , returnable on 16th October 2019 . By way of ad-interim relief, the respondent No. 2 is directed to forthwith release the provisional attachment of the bank account of the petitioner maintained with the Axis Bank Limited, Kalol.

Summary

Issues:
1. Impugned order of provisional attachment under section 83 of State Goods and Services Tax/Central Goods and Services Tax Act, 2017 lacks reference to the proceedings against the petitioner.
2. Validity of the provisional attachment of the bank account without specifying the section under which proceedings have been launched.
3. Legality of the attachment and sale of goods/shares under section 79 of the CGST Act without any assessed liability.

Analysis:

1. The petitioner's counsel highlighted the impugned order of provisional attachment of property under section 83 of the State Goods and Services Tax/Central Goods and Services Tax Act, 2017, pointing out the absence of reference to the ongoing proceedings against the petitioner. This lack of connection between the attachment and the launched proceedings raised concerns regarding the legality of the attachment.

2. Section 83 of the CGST Act allows for provisional attachment during the pendency of specific proceedings. The petitioner's counsel argued that the attachment of the bank account lacked legal authority due to the failure to specify the section under which the proceedings were initiated. This omission cast doubt on the validity of the attachment, prompting the court to intervene and direct the release of the provisional attachment.

3. Another issue raised was the attachment and sale of goods/shares under section 79 of the CGST Act without any assessed liability. The petitioner's counsel contended that section 79 pertains to the recovery of tax, which requires an assessed liability to be in place. The respondent's action of attaching goods without such an assessed liability was deemed unauthorized by law, further emphasizing the need for legal clarity and adherence to procedural requirements.

In response to the submissions made by the petitioner's counsel, the court issued a Notice returnable on a specified date and directed the immediate release of the provisional attachment of the petitioner's bank account. This interim relief was granted pending further examination of the legal validity of the attachment and the proceedings initiated by the respondent.