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TMI Blog2022 (12) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... Learned advocate Mr. Krutik Parikh waives service of Rule on behalf of respondent - State and its authorities. 1.2 Heard learned advocate Mr.Naman Kinkhabwala for the petitioner and learned AGP for the respondents. 2. What the petitioner has prayed in this Special Civil Application filed under Article 226 of the Constitution is to set aside attachment notice dated 06.01.2022 issued by the Assistant Commissioner of State Tax, Unit 16, Ahmedabad. The said notice came to be issued under Section 83 of the Central Goods and Services Tax Act, 2017 (CGST Act). 2.1 Further prayed is to direct the respondents and their officers to de-freeze bank account no. 10077040495 in IDFC First Bank, Kandivli (West), Mumbai, standing in the name of the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by M/s. Raja Traders in the bank account of the petitioner with an intention to defraud the Government revenue. 3.3 It appears that the contention of the petitioner that amount was paid by the petitioner to M/s. Raja Traders for purchase of goods are contrary to the facts recorded in the impugned order dated 6.01.2022 issued under section 83 of the CGST Act. 3.4 Be that as it may, the petitioner came to know about the impugned order dated 06.01.2022 when the petitioner was informed about the same by the bank. M/s. Raja Traders situated at Ahmedabad is registered under the CGST Act and proceedings have been initiated under section 67(2) of the CGST Act to determine the tax or any other amount due from it. 3.5 It appears that informatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nclusions in paragraph 52 of the judgment to reiterate the similar principle. 4.3 On the basis of the decision of Patran Steel Rolling Mill v. Assistant Commissioner of State Tax, Unit-2[2019 (20) GSTL 732 (Guj)], it was submitted that the powers under section 83 should not be used in a manner which may have irreversible detrimental effect on the business of the assessee. It was next submitted that this Court in Jai Ambey Filament Pvt. Ltd. vs. Union of India [2021(44) GSTL 41 (Guj)] held that the subjective satisfaction needed for exercise of powers under section 83 should not be based on imaginary grounds but there must be available credible opinion that attachment was necessary. 4.4. On the other hand, the learned advocate for the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring the pendency of any proceedings under section 62 or section 63 or section 64 or section 67 or section 73 or section 74, the Commissioner is of the opinion that for the purpose of protecting the interest of the Government revenue, it is necessary so to do, he may, by order in writing attach provisionally any property, including bank account, belonging to the taxable person in such manner as may be prescribed. (2) Every such provisional attachment shall cease to have effect after the expiry of a period of one year from the date of the order made under sub-section (1)." 5.1 The power is available under the aforesaid section to provisionally attach the property including the bank account which can be exercised by the competent authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... must necessarily be interpreted restrictively. Given that there were no pending proceedings against the appellant, the mere fact that proceedings under Section 74 had concluded against GM Powertech, would not satisfy the requirements of Section 83. Thus, the order of provisional attachment was ultra vires Section 83 of the Act." (para 72) 5.3 While the aforesaid decision is prior to 01.01.2022 when section 83 was amended, the amendment in section does not bring out any change to the requirement that there must be proceedings pending and that the powers under section 83(1) could be invoked only during the pendency of certain proceedings. 5.4 Section 83 as amended from 01.01.2022 reads as under, "(1) Where, after the initiation of any p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsence of any proceedings initiated. The powers under section 83 could not have been exercised. The impugned order stands illegal when it seeks to provisionally attach the bank account of the petitioner. It is only on this ground that the impugned Order is liable to be set aside.
6.1 As a result, the petition succeeds in part. The attachment order dated 6.1.2022 issued by the respondent no.3 is set aside. The respondent authorities may continue to proceed further pursuant to the summons dated 21.01.2022 and are at liberty to consider imposing the provisional attachment under section 83 of the CGST Act in accordance with law.
7. The petition is partly allowed. Rule is made absolute to the aforesaid extent. X X X X Extracts X X X X X X X X Extracts X X X X
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