Provisional attachment orders under Section 83 of the CGST Act cease after one year unless proceedings are pending; failure to comply undermines enforcement actions.

JUDGMENT

Manmohan, J. (Oral)--Present writ petition has been filed challenging the order dated 14th July, 2020 issued under Form GST DRC-22 provisionally attaching the Petitioner's current Bank Account with IndusInd Bank Ltd under Section 83 of the CGST Act, 2017 (hereinafter referred to as the `Act'). Petitioner also seeks direction to the Respondents to de-freeze the Petitioner's bank account.

2. Learned counsel for the petitioner submits that as per the provisions of Section 83(2) of the CGST Act, 2017, the order of provisional attachment of bank account ceases to have effect after the expiry of one year from the date of issuance of the order. She states that though the order of provisional attachment dated 14th July, 2020 has ceased to have effect on 13th July, 2021 yet the Petitioner is still not allowed to operate its bank account which had been provisionally attached by the impugned order. She relies on the order dated 22nd November, 2021 of this Court in M/s. Shri Dhan Laxmi Trade House Vs. Principal Commissioner of Goods and Service Tax, W.P.(C) 13080-2021 where under similar circumstances the Court allowed the petition and directed the Respondents to de-freeze the current account of the Petitioner therein.

3. Learned counsel for the petitioner also states that the impugned order is not maintainable as it does not disclose pendency of any proceeding under Sections 62, 63, 64, 67, 73 or 74 of the GST Act. She points out that the Petitioner's bank account was provisionally attached on the ground of initiation of proceedings under Section 7 of the CGST Act, 2017. In support of her submissions, she relies on the judgment of the Supreme Court in the case of Radha Krishan Industries v. State of H.P., (2021) 6 SCC 771.

4. Issue notice. Mr.Aditya Singla, learned counsel accepts notice on behalf of the respondent no.2.

5. Learned counsel for the respondent no.2, on instructions from Mr.Nikhil Mohan Goyal, Deputy Commissioner, CGST, West Delhi, who is personally present in Court, states that the investigation has not progressed in the present case as the petitioner is not co-operating. He states that none has appeared on behalf of the petitioner in response to the summons issued by the respondents. However, Mr.Aditya Singla, Advocate fairly admits that every provisional attachment order shall cease to have effect after expiry of one year from the date the order had been passed under Section 83(1) of the Act.

6. Learned counsel for the petitioner vehemently disputes the allegation of non-cooperation. She further states that in the event a copy of summon/notice is served upon her, she will ensure that the petitioner appears before the respondents within seven days.

7. The statement made by the learned counsel for the petitioner is accepted by this Court and the petitioner is held bound by the same.

8. In view of the position of law vis-a-vis Section 83 of the Act, present writ petition is allowed and the respondents are directed to defreeze the petitioner's bank account bearing current bank Account No. 201001178495 maintained with M/s. IndusInd Bank Ltd., Ground Floor, 2w/3, West Patel Nagar, Opp. Metro Pillar No.195, New Delhi-110008.

9. It is clarified that the respondents are at liberty to take further steps in accordance with law.

10. Accordingly, writ petition stands disposed of.