M/S.Dec Agrotech Private Limited And Anr. vs. Union Of INDIA And Ors.

Held

The Court held that the attachment order dated October 25, 2019, issued under Section 83 of the CGST Act, 2017, had lost its force. The reasoning was based on the petitioner's submission that the maximum period for such an attachment is one year, and the respondent's admission that they had not extended its tenure. Consequently, the Court found the respondent bank's action in preventing the petitioner from operating their bank account on the basis of this expired order to be not legally justified. The ratio decidendi is that an attachment order under Section 83 of the CGST Act, 2017, ceases to be operative after the expiry of its maximum statutory period, unless extended, and any action taken based on such an expired order is invalid. The Court directed that the bank shall not act any further on the basis of the impugned attachment order.

Facts

The petitioner, M/s. DEC Agrotech Private Limited & Ors., challenged the action of the respondent bank in preventing them from operating their bank account. This action was based on an order of attachment dated October 25, 2019, issued by the Deputy Director, DGGI, Kolkata Zonal Unit, under Section 83 of the CGST Act, 2017. The petitioner contended that the attachment order had lost its force as the maximum period for such an order under Section 83 is one year. The respondent CGST authority acknowledged that they had not extended the tenure of the attachment order.

Key Issues

1. Whether the attachment order dated October 25, 2019, issued under Section 83 of the CGST Act, 2017, has lost its force due to the expiry of its maximum validity period? The petitioner argued that Section 83 of the CGST Act, 2017, prescribes a maximum period of one year for an attachment order, and therefore, the impugned order dated October 25, 2019, is no longer operative. The respondents, while not disputing the expiry of the period, stated that they had not further extended the tenure of the attachment order.