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2023 (11) TMI 92 - HC - GSTProvisional attachment of bank account of petitioner - SCN was issued to the petitioner after initiation of proceedings under Section 67 of the Act - HELD THAT - Once the proceedings were initiated under Section 67 of CGST Act, which falls under Chapter XIV of the Act, there is no infirmity in the provisional attachment of the bank account which will remain in force for a period of one year. The show cause notice is pending before the proper officer/adjudicating authority, therefore, in the interest of safeguarding the interest of the Government revenue, it is imperative that the Bank account of the petitioner remains provisionally attached till the adjudication of the case and thereafter, till the realization of the confirmed Government dues. In the present case after the search was conducted on 08.01.2021 under Section 67 of CGST Act and thereafter bank account of the petitioner was attached under Section 83 of the Act, the power of attachment can be exercised on initiation of any proceedings under Chapter XII, XIV or XV. Since the proceedings were initiated under Section 67 of CGST Act, this procedure falls under Chapter XIV. Hence, even after amendment of Section 83 (1) of the CGST Act w.e.f 01.01.2022, the power of attachment can be exercised on initiation of any proceedings under Chapter XV, which has been done in the present case. In the present case, the show cause notice was issued after initiation of proceedings under Section 67 of the Act and these proceedings falls under Chapter XV and, thus, there is no infirmity in attachment of the bank account of the petitioner, which would be enforced for a period of one year. The petition is devoid of any merits and is dismissed.
Issues Involved:
1. Validity of the provisional attachment of the petitioner's bank account under Section 83 of the CGST Act. 2. Whether the proceedings initiated under Section 122 read with Section 127 fall under Chapters XII, XIV, or XV of the CGST Act. 3. Whether the petitioner has exhausted all statutory remedies before filing the writ petition. Summary of Judgment: Issue 1: Validity of the Provisional Attachment The petitioner-assessee challenged the provisional attachment of their bank account under Section 83 of the CGST Act. The Court noted that search operations were conducted on 08.01.2021 under Section 67, and the bank account was attached to safeguard government revenue. The petitioner's objections to the initial attachment were decided, and the account was released, only to be re-attached on 20.01.2023. The Court found no infirmity in the provisional attachment, as it was done to protect government revenue and was valid for one year. Issue 2: Proceedings Under Section 122 Read with Section 127 The petitioner argued that proceedings under Section 122 read with Section 127 do not fall under Chapters XII, XIV, or XV, making the attachment unlawful. However, the Court observed that the proceedings initiated under Section 67 fall under Chapter XIV. Therefore, the attachment was valid under the amended Section 83(1) of the CGST Act, effective from 01.01.2022. The Court referenced the Supreme Court's judgment in M/s Radha Krishan Industries vs. State of Himachal Pradesh, which considered the amended provisions of Section 83. Issue 3: Exhaustion of Statutory Remedies The respondents argued that the petitioner had not availed the statutory remedy of filing objections to the provisional attachment order, making the writ petition premature. The Court agreed, citing the Supreme Court's judgment in State of Punjab vs. M/s Shiv Enterprises, which emphasized that High Courts should not entertain writ petitions if effective statutory remedies are available. The Court also referenced United Bank of India vs. Satyawati Tondon, reiterating that petitioners must exhaust statutory remedies before approaching the High Court. Conclusion The Court dismissed the writ petition, finding it devoid of merit. The provisional attachment of the petitioner's bank account was upheld as valid, and the petitioner's failure to exhaust statutory remedies rendered the writ petition premature.
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