Mahavir Transmission Limited vs. Directorate General Of GST Intelligence(Hqrs) & Anr.

Facts

The Petitioner, Mahavir Transmission Limited, filed a writ petition challenging a letter dated December 31, 2020, issued by the Directorate General of GST Intelligence (DGGI) and another respondent. This letter directed the Petitioner's bankers to freeze and provisionally attach its bank accounts. The Petitioner sought a direction for the release and de-freezing of these accounts. The Respondent, through its standing counsel, stated that no fresh attachment order had been passed against the Petitioner. The Court was informed that the impugned provisional attachment orders were issued under Section 83(1) of the CGST Act, 2017.

Held

The Court held that the impugned provisional attachment orders had ceased to have effect after the expiry of one year from the date they were passed under Section 83(1) of the CGST Act, 2017, in accordance with the provisions of Section 83(2) of the Act. The Court reasoned that Section 83(2) explicitly limits the duration of a provisional attachment to one year from its issuance. Since the Respondent confirmed no fresh attachment orders were issued, the existing ones were deemed to have lapsed. Consequently, the Court allowed the writ petition and directed the Respondents to de-freeze the Petitioner Company's specified bank accounts within three working days of the order's upload.

Key Issues

1. Whether the provisional attachment orders issued under Section 83(1) of the CGST Act, 2017, have ceased to have effect after the expiry of one year from the date of their passing, as stipulated by Section 83(2) of the CGST Act, 2017? Petitioner's Contention: The Petitioner argued that Section 83(2) of the CGST Act, 2017, mandates that every provisional attachment shall cease to have effect after one year from the date of the order under sub-Section (1). Therefore, the impugned attachment orders, if still in effect, would have expired. Revenue's Contention: The Respondent stated that no fresh attachment order had been passed against the Petitioner as of the date of the hearing.