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 of these accounts. The tax period is not specified. The impugned action was the provisional attachment of bank accounts by the DGGI and another authority. The amount in dispute is not stated. The procedural history involves the issuance of the attachment order and the subsequent filing of the writ petition.

Held

The Court held that the provisional attachment orders issued under Section 83(1) of the CGST Act, 2017, had ceased to have effect after the expiry of one year from the date they were passed. This finding was based on the explicit provision of Section 83(2) of the CGST Act, 2017, which states that such attachments are time-bound. The Court accepted the submission of the Petitioner regarding the statutory time limit for provisional attachments. The Respondents did not contest this legal position, merely stating that no fresh attachment orders were issued. Consequently, the Court directed the Respondents to de-freeze the Petitioner Company's specified bank accounts within three working days of the order's upload. No issues were expressly left undecided.

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 in Section 83(2) of the CGST Act, 2017? 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. The Petitioner contended that the impugned attachment orders, issued on December 31, 2020, would have expired by operation of law. The Respondents, through their standing counsel, stated that they had instructions to the effect that no fresh attachment order had been passed against the Petitioner as of the date of the hearing.