2021 (2) TMI 291 - HC - GST

Provisional attachment of goods - section 83 of the Central Goods and Services Tax At, 2017 - HELD THAT - Indisputably, in the case on hand, no proceedings under Section62 or Section63 or Section64 or Section67 or Section73 or Section74 of the Act have been initiated or pending against the writ-applicant. In the absence of pendency of any such proceedings referred to above, the respondent no.2 could not have invoked Section83 of the Act for the purpose of provisional attachment. Assuming for the moment that something has surfaced in the course of any inquiry or investigation against the writ-applicant as regards some business transaction with any other individuals, the same by itself will not confer jurisdiction to the respondent no.2 to invoke the Section83 of the Act. The language of Section83 of the Act is plain and simple. In the absence of any proceedings pending as on date against the writ-applicant under the provisions of the GST Act as referred to under Section83 of the Act, the order of provisional attachment could not have been passed. The impugned communication at Page24, Annexure-C to this writ-application is hereby quashed and set aside. The attachment is ordered to be lifted. The bank shall permit the writ-applicant to operate his bank account - application allowed.

Summary

Issues Involved:
1. Validity of the provisional attachment order passed under Section 83 of the Central Goods and Services Tax Act, 2017 without any pending proceedings against the writ-applicant.

Analysis:
The writ-application sought relief from the High Court to quash and set aside the attachment order passed by the respondent under Section 83 of the CGST Act, 2017, and to defreeze the petitioner's bank account. The petitioner, a proprietor of a firm, was engaged as a commission agent at the Agricultural Produce Market Committee. The respondent had provisionally attached the bank account of the petitioner, citing the need to protect government revenue. However, the court deliberated on whether the respondent had the authority to invoke Section 83 without any pending proceedings under specified sections of the Act against the petitioner.

The court observed that no proceedings under the relevant sections of the Act were initiated or pending against the petitioner. Therefore, the respondent lacked the jurisdiction to attach the bank account under Section 83. The court emphasized that the language of the provision is clear, and in the absence of ongoing proceedings against the petitioner, the provisional attachment order could not be sustained. Consequently, the court decided to quash the impugned order of provisional attachment, allowing the petitioner to operate the bank account freely.

While the respondent argued that proceedings under Section 79 of the Act were initiated and pending against the petitioner, the court refrained from expressing any opinion on the merits of those proceedings. The court clarified that if such proceedings were indeed ongoing, they should continue in accordance with the law. However, the court's primary focus was on the lack of legal basis for the provisional attachment order under Section 83 in the absence of any pending proceedings against the petitioner. Ultimately, the writ-application was allowed, and the impugned communication was quashed, directing the lifting of the attachment on the bank account.