2021 (3) TMI 1038 - HC - GST

Provisional attachment of the petitioner s bank accounts - Section 83 of the Central Goods and Services Tax, 2017 - HELD THAT - The pre-requisite for exercise of powers of provisional attachment under Section 83 of the Act is the pendency of the proceedings under the aforementioned provisions, i.e., Sections 62, 63, 64, 67, 73 or 74 of the Act - the record shows that proceedings under Section 74 were initiated only after 10.11.2020. Furthermore, a perusal of order dated 18.01.2021 would show that only ₹ 40,000/- was available in the petitioner s bank account. Petition disposed off.

Summary

Issues: Validity of provisional attachment order under Section 83 of the CGST Act without pending proceedings under Sections 62, 63, 64, 67, 73, or 74.

Analysis:
1. The petitioner challenged the orders dated 19.05.2020 and 10.07.2020 passed by the Commissioner of Central Tax, GST, Delhi East. The first order directed the provisional attachment of the petitioner's bank account under Section 83 of the Central Goods and Services Tax, 2017.

2. The second order dated 10.07.2020 involved the adjudication of objections filed by the petitioner under Rule 159(5) of the Central Goods and Services Tax Rules, 2017. The Commissioner of CGST, East Delhi indicated that proceedings under Section 74 of the Act would be initiated.

3. During the proceedings, it was revealed that no proceedings were pending under Sections 62, 63, 64, 67, 73, or 74 of the Act concerning the petitioner before the provisional attachment order was issued on 19.05.2020.

4. The Court emphasized that the prerequisite for exercising powers of provisional attachment under Section 83 of the Act is the pendency of proceedings under the mentioned provisions. As proceedings under Section 74 were initiated only after 10.11.2020, the jurisdictional elements were not present when the order was issued on 19.05.2020.

5. Consequently, the Court held that the order dated 19.05.2020 was invalid in the eyes of the law as the necessary jurisdictional elements were lacking. Therefore, the said order was quashed, leading to the quashing of the subsequent order dated 10.07.2020.

6. The Court clarified that its order did not prevent the respondents from issuing a fresh order for provisional attachment, provided it complies with the law. The writ petition was disposed of accordingly.