Pradeep Kumar Siddha vs. Union Of INDIA Thr Central Govt. Advocates And Ors

Held

The Court held that by operation of statute, specifically Section 83(2) of the CGST Act, 2017, a provisional attachment ceases to take effect after a period of one year from the date of the order. The Court noted that the Petitioner had appeared before the authority pursuant to the Court's order, his statement had been recorded, and he had assured cooperation in the proceedings. Consequently, the provisional attachment under the order dated July 13, 2020, was deemed to have ceased to take effect. The Court disposed of the writ petition. The ratio decidendi is that the statutory time limit for provisional attachment under Section 83(2) of the CGST Act, 2017, is binding, and the attachment lapses automatically upon its expiry unless extended or renewed in accordance with law. The operative direction was that the provisional attachment shall cease to take effect.

Facts

The Petitioner, Pradeep Kumar Siddha, filed a writ petition seeking the provisional release of his attached bank account. The account was initially attached on May 22, 2019, and subsequently re-attached on July 13, 2020. The Petitioner contended that a provisional attachment under Section 83 of the CGST Act, 2017, cannot exceed one year. The Respondents argued that the Petitioner was not cooperating with the investigation, necessitating court intervention to direct his cooperation. The Petitioner's statement was recorded, and he agreed to transfer funds to the government. The Court had previously directed the Petitioner to appear before the authority to test his bonafides.

Key Issues

1. Whether a provisional attachment of property under Section 83 of the CGST Act, 2017, ceases to have effect after one year from the date of the order, as stipulated in Section 83(2). Petitioner's Argument: The Petitioner argued that Section 83(2) of the CGST Act, 2017, explicitly states that every provisional attachment shall cease to have effect after the expiry of one year from the date of the order made under sub-section 1. Therefore, the attachment order dated July 13, 2020, which is beyond one year, should have ceased to be effective. Revenue's Argument: The Respondents contended that the Petitioner was not cooperating with the investigation. They submitted that the Court had to pass an order directing the Petitioner to cooperate. The Petitioner's statement was recorded, and he accepted that an amount be transferred to the government. The Respondents' stance implied that the Petitioner's lack of cooperation might have influenced the duration or validity of the attachment, although they did not explicitly argue for an exception to the one-year rule.