The Delhi High Court observed that only one-year validity application to provisional attachment order under section 83 (2) of the Central Goods and Service Tax ( CGST ) Act, 2017. The court directed the bank not to restrain the operation of the petitioner’s bank account.
M/S Krish Overseas, the petitioner impugns communication dated 14.08.2019 issued under Section 83 of the Central Goods and Service Tax Act, 2017 (Act) to the Branch Manager, HDFC Bank Ltd., Paschim Vihar Branch to seize the outward movement of funds from the bank account of the petitioner.
It was submitted that the validity of an order under Section 83 of the Act is one year and despite the passage of one year, the Bank is not permitting the operation of the said account.
Section 83 empowers the Commissioner to provisionally attach any property including a bank account, belonging to a taxable person for the purposes of protecting the interest of the Government revenue, if in the opinion of the Commissioner, it is necessary to do so. Section 83(2) stipulates that every provisional attachment ceases to have effect after the expiry of a period of one year from the date said order is made under Section 83 (1) of the Act.
In view of Section 83 (2) of the Act, the life of an order of provisional attachment is only one year. The impugned communication is dated 14.08.2019 and it was found that a period of one year has elapsed from the issuance of the said communication. Consequently, the impugned order has ceased to be effective and cannot be any more implemented either by the respondents No.1 and 2 or the HDFC Bank i.e., respondent No.3.
A division bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja declared that order dated 14.08.2019 ceases to have effect. Further held that the respondent No.3, HDFC Bank henceforth cannot restrain operation of the bank account of the petitioner based solely on the basis of order dated 14.08.2019.
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