M/S Deep Chand Rajesh Kumar vs. Union Of INDIA And Others

Held

The Court disposed of the writ petition by noting the instructions issued by the GST-Investigating Wing dated 02.09.2023. These instructions stipulate that the bank accounts of the petitioner will be de-frozen within a period of two weeks from the date of the order. The Court's decision is based on the understanding that the provisional attachment of the petitioner's bank accounts, made in December 2020, has indeed ceased to have effect after the expiry of one year, as per Section 83(2) of the CGST Act, 2017, and the subsequent circular. The ratio decidendi is that statutory provisions and subsequent circulars clarifying their application, particularly regarding the time limit for provisional attachments, must be adhered to by the revenue authorities, leading to the release of attached assets. The operative direction is for the bank to de-freeze the petitioner's three bank accounts within two weeks.

Facts

The petitioner, M/s Deep Chand Rajesh Kumar, had its bank accounts frozen in December 2020. The petitioner contends that under Section 83(2) of the CGST Act, 2017, a provisional attachment ceases to have effect after one year. The petitioner relies on a circular dated 02.09.2023 issued by the GST-Investigation Wing, which reiterates this provision and prescribes a procedure for intimating the concerned authority/bank about the release of such attachments. The respondents are the Union of India and others. The petition was filed before the High Court of Punjab and Haryana at Chandigarh.

Key Issues

1. Whether the provisional attachment of the petitioner's bank accounts, made in December 2020, has ceased to have effect in accordance with Section 83(2) of the CGST Act, 2017, given that more than one year has elapsed since the attachment. Petitioner's arguments: The petitioner argues that Section 83(2) of the CGST Act, 2017, mandates that a provisional attachment lapses after one year. They cite a circular dated 02.09.2023 from the GST-Investigation Wing, which confirms this position and provides a procedure for releasing such attachments. The petitioner asserts that their accounts should be de-frozen based on these provisions and the circular. Respondents' arguments: The judgment does not record any specific arguments made by the respondents. However, the court's disposal indicates an acceptance of the petitioner's contention based on the cited circular and statutory provision.