2021 (3) TMI 185 - HC - GST

Release of provisionally attached Bank Accounts - Section 83 of the Central Goods and Services Tax Act, 2017 - HELD THAT - There is a challenge to the constitutional validity of Rule 159 and sub-rules 1, 5 and 6 apart from a challenge on merits to the notice dated 14.08.2020 and the impugned order dated 28.09.2020. Issue notice to the respondents.

Summary

Issues involved:
1. Provisional attachment of bank accounts under Section 83 of the Central Goods and Services Tax Act, 2017.
2. Interpretation of the notice for provisional attachment dated 14.08.2020.
3. Challenge to the constitutional validity of Rule 159 and sub-rules 1, 5, and 6.
4. Examination of the powers conferred for provisional attachment under Section 83 read with Rule 159 (1).

Analysis:

1. The petitioners challenged the order rejecting objections to the notice for provisional attachment dated 14.08.2020, issued by the Commissioner of Central Tax, Delhi West Commissionerate. Mr. Tejpal Kang, representing the petitioners, argued that the power to provisionally attach bank accounts is available under Section 83 of the Central Goods and Services Tax Act, 2017. He pointed out that the impugned order referred to proceedings under Section 7 of the Act, which Mr. Kang argued was not relevant to Section 83.

2. On the contrary, Mr. Harpreet Singh, representing the Revenue, contended that the reference to Section 7 in the order was a mistake and should have been to Section 67. He highlighted that the notice mentioned Rule 159 (1) and argued that the powers for provisional attachment are derived from Section 83 read with Rule 159 (1). Additionally, there was a challenge to the constitutional validity of Rule 159 and its sub-rules, along with challenges to the notice and the impugned order.

3. The Court acknowledged the need for a thorough examination of the matter, leading to the issuance of a notice to the respondents. Mr. Jain accepted service on behalf of some respondents, while Mr. Singh accepted service on behalf of others. The Court directed the filing of counter-affidavits within six weeks and allowed for rejoinders before the next hearing date.

4. Mr. Kang decided not to pursue the application for stay, resulting in the closure of the said application. The Court scheduled the next hearing for 24.05.2021 to further address the issues raised regarding the provisional attachment of bank accounts and the interpretation of relevant legal provisions.

This detailed analysis of the judgment highlights the arguments presented by both parties, the Court's observations, and the procedural steps taken for further examination of the legal issues involved in the case.