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2021 (4) TMI 31 - HC - GSTValidity of Summons issued - jurisdiction to initiate proceedings under the CGST/SGST Act - attachment of Bank Accounts of petitioner - HELD THAT - The summons, which has been issued under Section 70 of the CGST Act cannot be construed as a notice affording an opportunity of hearing to the first respondent, in terms of Sub- Rule 5 of Rule 159 of the CGST Rules. The summons is in connection with the investigation initiated against the first respondent. Therefore, the appellant cannot take umbrage under the summons, dated 27.01.2021 to be construed as a notice under Rule 159(5). In the considered view of this Court, an order of attachment of the first respondent's bank account, which are stated to be 14 in number, should be for the purpose of protecting the interest of the Government Revenue and the Commissioner should be of the opinion, it is for such purposes and he is required to pass an order in writing attaching provisionally any property including bank account. The procedure is in terms of Rule 159 of the CGST Rules - It is submitted by the learned counsel for the appellants that the impugned order dated 10.03.2021 is yet to be given effect to and it is also submitted that the interest of Revenue would suffer, if the attachments are to be lifted at this stage, especially, when the first respondent is not cooperating in the investigation and therefore, the Court may fix a time frame within which the request for lifting the provisional attachment is decided by the first appellant. The authorized representative of the first respondent shall appear before the first respondent at 11.00 AM on 29.03.2021 - an opportunity of personal hearing be granted to the authorized representative - Appeal allowed in part.
Issues:
1. Challenge to the summons issued by the Directorate General of Goods and Service Tax Intelligence under the CGST/SGST Act. 2. Validity of the provisional attachment of bank accounts. 3. Lack of cooperation in the investigation by the first respondent. 4. Impact of the provisional attachment on the business operations of the first respondent. Analysis: 1. The writ appeal challenged an order regarding a summons issued by the Directorate General of Goods and Service Tax Intelligence under the CGST/SGST Act. The respondent filed a writ petition seeking to quash the summons on grounds of lack of jurisdiction. The High Court noted that the summons was challenged mainly on the basis that the first respondent lacked the authority to initiate proceedings under the said Acts. The petitioner also sought an interim stay on further proceedings related to the summons. 2. The High Court examined the validity of the provisional attachment of bank accounts. It was observed that the order of attachment was for protecting the government revenue, and the Commissioner had the authority to attach property, including bank accounts, for this purpose. The Court emphasized the need for the first respondent to cooperate in the investigation and explained the procedure for lifting the provisional attachment if it was deemed unnecessary. 3. The lack of cooperation by the first respondent in the investigation was highlighted by the Court. The first respondent, a business organization in the transportation industry, was noted for not extending cooperation during the investigation. The Court considered the impact of the provisional attachment on the business operations of the first respondent, emphasizing the need to balance the interests of the government revenue and the business operations of the respondent. 4. The Court issued directions to address the issues raised, including staying the impugned order subject to specific conditions. The authorized representative of the first respondent was directed to appear before the first appellant for a personal hearing. The first appellant was instructed to pass a speaking order within a specified timeframe, considering the first respondent's plea regarding the impact on their business operations. The Court allowed the writ appeal partly, subject to the directions issued, and closed the connected miscellaneous petition.
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