Saurav Beverages Private Limited vs. Commissioner Of CGST, Delhi (East) & Ors.

Facts

The petitioner, Saurav Beverages Private Limited, filed a writ petition before the Delhi High Court challenging an order dated December 9, 2020, passed by the Commissioner of CGST, Delhi (East) (Respondent No. 1), which attached the petitioner's bank account maintained at Axis Bank. The petitioner also challenged a subsequent order dated January 20, 2021, by which their motor vehicle was provisionally attached under Section 83 of the CGST Act. The petitioner stated that similar orders were issued attaching other bank accounts. The impugned orders were communicated directly to the banks and the Regional Transport Office (RTO). The petitioner argued that these attachments were no longer operative.

Held

The Court held that the provisional attachment orders issued under Section 83 of the CGST Act, 2017, had ceased to be operative. This was based on the petitioner's submission and the respondent's concession that the controversy was covered by previous decisions of the High Court. Crucially, the Court noted that in terms of Section 83(2) of the CGST Act, an order of provisional attachment ceases to operate after the expiry of one year from the date it was passed. Therefore, even if valid orders were initially passed, they would no longer be in effect. The Court directed the respondent banks not to prevent the petitioner from operating their bank accounts based on the impugned communications. Respondent No. 7 (RTO) was also directed not to take any steps based on the impugned order dated January 20, 2021. The Court also directed the respondent to ensure that they communicate to the concerned banks once an order of attachment ceases to be operative, as per subsisting directions/instructions.

Key Issues

1. Whether the provisional attachment orders issued under Section 83 of the CGST Act, 2017, have ceased to be operative due to the expiry of the statutory period. Petitioner's Contention: The petitioner argued that the impugned orders of provisional attachment, including the attachment of their bank account and motor vehicle, were no longer in effect as they had expired by operation of law. Specifically, they highlighted that Section 83(2) of the CGST Act stipulates that an order of attachment ceases to operate after one year from the date of the order. Revenue's Contention: The learned counsel for the respondent (Commissioner of CGST, Delhi (East)) did not dispute that the controversy was covered by previous decisions of the High Court. The judgment does not record any specific argument from the revenue regarding the operative status of the attachment orders.