2020 (1) TMI 744 - HC - GST

Seizure of money - attachment of bank account and goods - Rule 139 of the CGST Rules, 2017 - It is submitted by the counsel for the respondents, who appear on advance notice, that at this stage enquiry is going on. Counsel for the petitioner states that petitioners are ready to join the enquiry as and when called by the IO. Counsel for the petitioners submits that petitioners will produce all the documents necessary for the purpose of enquiry. HELD THAT - List on 27.3.2020.

Summary

Issues involved:
1. Adjudication of seizure of money, attachment of bank account, and goods under Rule 139 of the CGST Rules, 2017.
2. Quashing of summons notices and consequential proceedings as illegal, arbitrary, and unconstitutional.
3. Interpretation of provisions of the CGST Act, especially sections 69 and 132, in line with Articles 14 and 21 of the Constitution.
4. Validity of investigations under Section 132 of the CGST Act without magistrate's order or following Cr.P.C. procedures.
5. Removal of attachment of the petitioner's bank accounts.

Analysis:

1. The petitioners sought appropriate writs to adjudicate the tenability of the seizure of money, attachment of bank accounts, and goods under Rule 139 of the CGST Rules, 2017. The respondents informed the court that an inquiry is ongoing, and the petitioners expressed readiness to participate in the investigation and provide necessary documents. The court scheduled the matter for further hearing and directed the respondents to file a reply within four weeks. Additionally, the court ordered no coercive action against the petitioners until the next hearing on 27.3.2020.

2. The petitioners requested writs to quash summons notices issued by the respondents, alleging them to be illegal, arbitrary, and unconstitutional. The court's intervention was sought to annul the summons and subsequent proceedings. The matter was left pending for further consideration, allowing both parties to present their arguments and evidence before the court.

3. A crucial issue raised was the interpretation of provisions of the CGST Act, specifically sections 69 and 132, in light of Articles 14 and 21 of the Constitution. The petitioners urged the court to align the statutory provisions with constitutional principles while balancing individual rights and the revenue authorities' need for penal actions. This aspect required a detailed examination of the legal framework and its conformity with fundamental rights guaranteed by the Constitution.

4. The legality of investigations initiated by the respondents under Section 132 of the CGST Act without a magistrate's order or adherence to Cr.P.C. procedures was challenged by the petitioners. They argued that such investigations were null and void, lacking jurisdiction and violating constitutional provisions. The court was called upon to assess the procedural validity of the investigations and determine their compliance with established legal norms.

5. Lastly, the petitioners sought directions for the removal of attachment on their bank accounts. This issue involved the practical aspect of the case, focusing on the immediate relief sought by the petitioners regarding the financial restrictions imposed on them. The court was expected to evaluate the necessity and legality of such attachments and decide on the appropriate course of action to address this specific concern.