2024 (2) TMI 1212 - HC - GST

Provisional attachment of cash credit accounts of the petitioners - expiry of period of one year from the date it is made - petitioners submits that repeated attachment of cash credit accounts in exercise of power under Section 83 of the CGST Act is in breach of the provisions of Section 83(2) and such exercise could not have been undertaken - HELD THAT - In view of the admitted position that the order, subject matter of these proceedings has ceased to operate, the petition is disposed of reserving the right of the petitioner to impugn the fresh attachment order dated 13.12.2023 in accordance with law. The question of validity of repeated issuance of attachment orders under Section 83 of the CGST Act is left open.

Summary

Issues involved: Impugning order u/s 83 of CGST Act provisionally attaching cash credit accounts, validity of repeated attachment orders u/s 83, lack of receipt of attachment order.

Impugned Order under Section 83 of CGST Act:
The petitioner challenged the order dated 04.08.2022 passed u/s 83 of the CGST Act, provisionally attaching the cash credit accounts. The petitioner argued that as per Section 83(2) of the CGST Act, the maximum period for attachment of cash credit accounts is one year from the date of the order u/s 83(1). Since the orders had ceased to operate, the petitioner contended that there should be no impediment in operating the cash credit accounts.

Validity of Repeated Attachment Orders:
The respondents conceded that orders passed u/s 83(1) provisionally attaching the cash credit accounts have a lifespan of one year and cease to operate after that period. However, a fresh attachment order dated 13.12.2023 was issued, once again provisionally attaching the cash credit accounts u/s 83(1). The petitioner argued that repeated attachment of cash credit accounts under Section 83 is a breach of Section 83(2) and contended that they had not received copies of the attachment order dated 13.12.2023.

Judgment and Disposition:
The court acknowledged that the order in question had ceased to operate, leading to the disposal of the petition while reserving the petitioner's right to challenge the fresh attachment order dated 13.12.2023 in accordance with the law. The court left the question of the validity of repeated issuance of attachment orders under Section 83 of the CGST Act open for future determination, reserving all rights and contentions of the parties.