The Telangana High Court ordered the provisional release of Bank account in the matter of GST refund sanction amount.
The Petitioner No.1, MS DivyasreeNsl, is a company incorporated under the Companies Act, 1956 and engaged in the business of construction, development and operation of IT Parks/ITES and the remaining petitioners ae the Directors of the company.
An order was passed by the respondenton a claim made by the petitioners for refund for the period July 2020 and later had had sanctioned refund of Rs.27.54 crores to petitioner in terms of Section 54(5) of the Central Goods and Services Tax Act, 2017 (CGST Act) read with Rule 92(1) of the Central Goods and Services Tax Rules, 2017 (CGST Rules).
Later there was an order under Section 83 of the CGST Act to the bankers of petitioner for provisional attachment of bank accounts.
The Counsel for the petitioner referred to the guidelines dated 23.02.2021 issued by the Central Board of Indirect Taxes and Customs and submitted that while carrying out provisional attachment of the bank accounts of the petitioner, the respondents have not followed the said guidelines.
The Counsel further submitted that attachment of bank account of an ongoing concern, be it provisional or otherwise, is a drastic measure which should not be resorted to unless warranted, that too, as the last resort. Such attachment of bank account may lead to economic death of such a concern.
The Counsel for the respondents contended that though respondents had issued summons to the petitioners, on one pretext or the other they did not appear before the summoning authority and that the refund order was obtained fraudulently by the petitioners.
The Coram comprising of Chief Justice Ujjal Bhuyan and Justice N Tukaramji observed that “The refund sanction amount, as noticed above, is Rs.27.54 crores. Petitioners shall make a deposit of Rs.28.00 crores in a nationalised bank by way of fixed deposit.”
The Court also directed that the Respondents shall forthwith withdraw the provisional attachment of bank accounts of petitioner.
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