2024 (5) TMI 406 - HC - GST

Provisional attachment of bank account - HELD THAT - The cause of action does not appear to exist, insofar as the revenue authorities have realised that provisional attachment order dated 16.2.2023 does not survive. It appears to be a common mistake being caused by revenue authorities where provisional attachment orders may never continue for more than one year are allowed to exist beyond that end date. Such error on the part of the revenue authorities leaves the assessee with no option but to approach this Court for effective direction on the revenue authorities to actually lift the provisional attachment. In face of the statutory provision being unequivocally clear, the revenue authorities when called upon by this Court, take a stand as has been noted in the present facts. Thus, the provisional attachment orders are actually lifted only upon the revenue authorities being questioned about the illegality of their action, by this Court. Once the statutory law admits of no doubt and the revenue authorities do offer correction to the error committed by them upon being pointed out by this Court, it is found that such litigation whenever it arises to be wholly avoidable - petition disposed off.

Summary

Issues involved: The judgment deals with the issue of the provisional attachment of a bank account u/s 83(2) of the CGST Act, 2017 and the necessity of court intervention to rectify errors made by revenue authorities in lifting such attachments.

Summary:

Issue 1: Provisional Attachment under Section 83(2) CGST Act:
The petitioner sought a writ to release a provisionally attached bank account u/s 83(2) of the CGST Act. The High Court noted that the provisional attachment had expired as per the statutory provision, yet it continued. The revenue authorities acknowledged the expiration after court intervention and lifted the attachment. The Court expressed concern over the recurring need for court intervention to rectify such errors by revenue authorities, emphasizing the avoidability of such litigation.

Key Details:
- The provisional attachment of the bank account was stated to have expired as per Section 83(2) of the CGST Act.
- Revenue authorities acknowledged the expiration only after court intervention.
- The Court highlighted the need for corrective action by revenue authorities to prevent unnecessary litigation.
- The judgment directed the communication of the order to the Central Board of Indirect Taxes and Customs for necessary action and to the State Commissioner for remedial measures.

Conclusion:
The judgment addresses the issue of prolonged provisional attachment beyond statutory limits u/s 83(2) of the CGST Act, emphasizing the importance of revenue authorities taking corrective actions promptly to avoid unnecessary court interventions.