Power to Pass Provisional Attachments Order under GST cant be delegated to Assistant Commissioner: Gujarat HC [Read Judgment]

Provisional Attachment - Order - Assistant Commissioner - CGST Act - Taxscan

The Gujarat High Court has held that the Commissioner ought not to have delegated his powers of provisional attachments under Section 83 of the CGST Act to the Assistant Commissioner.

The ruling was made by a division bench comprising of members Justice J.B.Pardiwala and Justice Bhargav D. Karia in the case of Enprocon Enterprise Ltd. Vs. The Assistant Commissioner of State Tax. The office premises of the appellant company situated at Ahmedabad and Baroda were raided by the respondent-Authorities, in the exercise of their powers, under Section 67 of the CGST Act, 2017. The search and seizure were undertaken by the Authorities and the proceedings under Section 73 of the GGST Act, 2017, have been initiated against the appellant. Later an order of provisional attachment of the immovable property situated at Ahmedabad, came to be passed by the Assistant Commissioner of State Tax in the exercise of powers, under Section 83 of the Act, 2017. Being dissatisfied with the order of provisional attachment, the appellant is here before this Court, with the present Writ Application.

The respondent authority is submitted that with a view of unearthing the billing transactions had taken the statement of legal representative of the company and he has mentioned that he was given merely Rs.8,000/- per month for the purpose of making and providing fake bills with a view to avail the input tax credit (ITC), such bills were given to the petitioner company. The petitioner was involved in billing activities with Shivay Enterprise to the tune of Rs.49.80 Lakhs defrauding the government.

The Court ruled that the Commissioner ought not to have delegated his powers of provisional attachment under Section 83 of the Act to the Assistant Commissioner. Therefore, the orders of provisional attachment as well as the order of prohibition are not sustainable on two counts, i.e. (i) the order has been passed by the Assistant Commissioner, and (ii) the order has been passed without any credible materials, available for the purpose of passing such order of provisional attachments. The order of provisional attachment passed by the Assistant Commissioner, so far as the immovable property is concerned, is hereby quashed and set aside.

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