2021 (7) TMI 998 - HC - GST

Provisional attachment of bank accounts and immovable properties - petitioner has already deposited the amount of deposit for filing the appeal - Section 83 of CGST Act - HELD THAT - Considering the affidavit-in-reply filed by the respondent to the effect that the petitioner firm is liable to pay the tax with interest and penalty, in aggregate ₹ 1,09,61,102/- and the department has attached the movable and immovable properties to the tune of ₹ 75,48,541/-, which include the attachment of two bank accounts i.e. of Union Bank of India account, having balance amount of ₹ 4,16,050/- and Canara Bank account with balance of ₹ 5,386/- and two other immovable properties worth ₹ 55,37,123/- and ₹ 15,89,982/- respectively, the Court is of the opinion that the interest of the Revenue would still remain substantially protected even if, at present, without going into the merits of the case, the provisional attachment in respect of two bank accounts is removed. It may be noted that the petitioner has already deposited the amount of deposit for filing the appeal under section 107 of the said Act. The provisional attachment in respect of the bank account of the Canara Bank is removed - provisional attachment in respect of the two immovable properties shall continue.

Summary

Issues:
1. Interpretation of provisions under the Central Goods and Services Tax Act, 2017 regarding provisional attachment of assets.
2. Impact of recent amendments to Section 83 of the Central Goods and Services Tax Act, 2017.
3. Assessment of the petitioner's liability to pay tax, interest, and penalty.

Detailed Analysis:

1. The petitioner relied on a Supreme Court decision in M/s. Radha Krishan Industries vs. State of Himachal Pradesh and Others, AIR 2021 SC 2114, arguing that the provisional attachment under Section 83 of the Central Goods and Services Tax Act, 2017 should be lifted since an appeal had been filed under Section 107 and the required pre-deposit had been made. However, the respondent highlighted that Section 83 had been amended by the Finance Act, 2021, and requested time to verify the effective date of the amendment. The court scheduled the matter for further hearing on 30th July 2021.

2. Despite the above, the court considered the respondent's submission that the petitioner firm was liable to pay a total of ?1,09,61,102 in tax, interest, and penalty. The department had already attached movable and immovable properties totaling ?75,48,541, including two bank accounts with balances of ?4,16,050 and ?5,386, and two immovable properties valued at ?55,37,123 and ?15,89,982. The court found that the Revenue's interest would still be substantially protected even if the provisional attachment of the two bank accounts was lifted. The petitioner had already deposited the required amount for filing the appeal under Section 107 of the Act.

3. Consequently, without delving into the merits of other issues in the petition, the court ordered the removal of the provisional attachment on the Union Bank of India and Canara Bank current accounts, while maintaining the attachment on the two immovable properties. The decision aimed to balance the interests of the parties involved while ensuring the protection of the Revenue's claim.