GST: Allahabad HC upholds Provisional attachment of Bank Accounts and FDR as it was issued for protecting interest of Government revenue
December, 10th 2020
The Allahabad High Court upheld the provisional attachment of Bank Accounts as it was issued for protecting interest of Government revenue.
The petitioner, M/s R.J. Exim filed the petition praying to quash the impugned orders passed by the respondent authority in exercise of powers conferred under Section 83 of the Central Goods and Services Tax Act, 2017.
The petitioners have further prayed to issue a direction to the respondents concerned to release forthwith the provisional attachment of the current and saving bank account in Union Bank of India, and also to release the FDR of Rs. 25 Lacs issued in the name of Principal Commissioner, CGST, Meerut in favour of the petitioners.
The petitioners submit that as only show cause notice under Section 70 of the Central Goods and Services Tax Act, 2017 has been issued, the attachment under Section 83 of CGST Act can not be made. Consequently, the impugned orders of provisional attachment are bad and it is liable to be quashed.
The single judge bench of justice Dr. Yogendra Kumar Srivastava found that order was issued by the proper officer to the petitioners, informing GST DRC-01A under Section 74(5) of the Act, requiring the petitioners to deposit the ascertained amount of Rs.69,67,729 and interest, and penalty or to submit objection under Section 74(1) of the Act. An opportunity was also given by fresh notice so that petitioners may file an objection against the above ascertainment in Part B of the Form.
The court held that the impugned Provisional attachment order has been issued by the competent authority under Section 83 of the Act for the purpose of protecting interest of the Government revenue.
It was further clarified that the petitioners have an opportunity to file an objection under sub-Rule 5 of Rule 159 of the Rules against the order of Provisional attachment under Section 83(1) of the Act.