2021 (11) TMI 60 - HC - GST

Provisional attachment of petitioner's Account - Seeking restraint on petitioner from utilising its money lying in its bank account - submission of petitioner is that merits of the action taken by the respondents apart, today, by virtue of the operation of law, the revenue authorities are not entitled to continue the attachment beyond 10.05.2021 - HELD THAT - In absence of any contrary position existing in law and in absence of any other action being shown to have been taken by the respondent authorities, whereby they may claim entitlement to attach petitioner's bank account, it is found that the communication dated 11.05.2020 issued by the Assistant Commissioner (A.E.), Central Tax, Gautam Budh Nagar has outlived its life and perhaps its utility. The writ petition is disposed off with the observation that the provisional attachment of the petitioner's bank account may not survive under the communication.

Summary

Issues:
Challenge to action by revenue authorities restraining petitioner from utilizing bank account; Provisional attachment under CGST Rules; Entitlement of revenue authorities to continue attachment beyond specified date.

Analysis:
The High Court considered a writ petition challenging the action of revenue authorities restraining the petitioner from using funds in a bank account. The provisional attachment of the account was done under Rule 129(1) of the CGST Rules, 2017 and Section 83 of the CGST Act, 2017. The petitioner argued that, as of the date of the hearing, the revenue authorities were not entitled to continue the attachment beyond a specific date. The Court noted that without any legal basis or further action by the revenue authorities, the communication from 11.05.2020 regarding the attachment had lost its validity and utility.

The Court found that there was no legal basis for the revenue authorities to maintain the provisional attachment of the petitioner's bank account beyond a certain date. Consequently, the Court disposed of the writ petition by directing that the provisional attachment of the bank account should not be considered valid under the communication dated 11.05.2020. The bank was instructed to act accordingly and not treat the petitioner's account as provisionally attached by the revenue authorities based on the outdated communication.