2023 (8) TMI 778 - HC - GST

Provisional attachment of Bank Accounts - Petitioner submits that it is not the current account but in fact the cash credit account which is provisionally attached - Section 83 of the CGST Act - HELD THAT - It appears that on more than one occasion, the Court has deprecated the practice of the respondent authorities in seeking to enforce tax liabilities by provisionally attaching cash credit account. Issue notice to the respondent/s, returnable on 17.8.2023.

Summary

Issues involved: Provisional attachment of cash credit account u/s 83 of the CGST Act.

Summary:
The High Court of Gujarat heard a petition challenging a communication dated 10.7.2023 in form DRC-22, where the Principal Commissioner provisionally attached a current account under Section 83 of the CGST Act. The petitioner argued that it was the cash credit account that was attached, not the current account, supported by a bank statement and previous court judgments. The court noted that previous decisions have criticized the practice of attaching cash credit accounts for tax liabilities. Notice was issued to the respondent for a returnable date of 17.8.2023, with interim relief granted until then.

In a corrigendum order, a rectification was made regarding the current account number mentioned in the previous order, correcting it to the accurate account number. The rest of the order remained unchanged, and direct service was permitted.

This judgment highlights the issue of provisional attachment of cash credit accounts under Section 83 of the CGST Act, emphasizing the importance of distinguishing between current accounts and cash credit accounts in such proceedings.