The Delhi High Court disposed of writ petition on ceasing of operation of proceedings in the matter relating to provisional attachment of cash credit accounts.
The Petitioner impugned the order passed under Section 83 of the Central Goods and Services Tax Act, 2017 [ CGST Act ], provisionally attaching the cash credit accounts of the petitioners.
The counsel for the petitioner submitted that maximum period for attachment of cash credit accounts in terms of Section 83(2) of the CGST Act is a period of one year from the date the order is made under Section 83(1) of the CGST Act. He submitted that since orders have ceased to operate, there can be no impediment in petitioners operating the cash credit accounts.
The counsel for the petitioners submitted that repeated attachment of cash credit accounts in exercise of power under Section 83 of the CGST Act is in breach of the provisions of Section 83(2) and such exercise could not have been undertaken. He further submitted that petitioners have not received copies of attachment order dated 13.12.2023.
The counsel for the respondents conceded to the statutory position that orders passed under Section 83(1) of the CGST Act provisionally attaching the cash credit accounts have a life of only one year and cease to operate after the expiry of period of one year from the date it is made. The counsel, however, submits that fresh attachment order dated 13.12.2023 has been passed once again provisionally attaching the cash credit accounts under Section 83(1) of the CGST Act.
A Division Bench of Justices Sanjeev Sachdeva and Ravinder Dudeja observed that “In view of the above, admitted position that the order, subject matter of these proceedings has ceased to operate, the petition is disposed of reserving the right of the petitioner to impugn the fresh attachment order dated 13.12.2023 in accordance with law. The question of validity of repeated issuance of attachment orders under Section 83 of the CGST Act is left open.”
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