Ankit Lokesh Gupta vs. State Of Gujarat

Held

The Court held that the provisional attachment of the petitioner's bank account under Section 83 of the CGST/GGST Act was without authority of law. The Court reasoned that Section 83 permits provisional attachment only during the pendency of proceedings under specific sections (62, 63, 64, 67, 73, and 74). The attachment in this case was based on proceedings under Section 71(1), which is not listed in Section 83. The Court emphasized that attachment of bank accounts has serious civil consequences, affecting economic standing and reputation, and requires careful consideration by authorities. Although the attachment was subsequently released, this did not validate the initial order. The petition was disposed of with costs of Rs. 10,000/-, recoverable from the concerned officer, as the impugned order was fundamentally without legal basis.

Facts

The petitioner, Ankit Lokesh Gupta, filed a Special Civil Application challenging an order dated 19.09.2019, issued by the second respondent, provisionally attaching his bank account. The attachment was made without furnishing a copy of the order to the petitioner, who obtained it from the bank. Simultaneously, the second respondent issued a summons under Section 70(1) of the CGST Act and GGST Act, requiring the petitioner's presence on 09.10.2019. The petitioner contended that the provisional attachment was without legal authority. The respondent State of Gujarat submitted that the attachment was subsequently released by an order dated 27.09.2019, served on the bank on 30.09.2019, rendering the grievance moot.

Key Issues

1. Whether the provisional attachment of the petitioner's bank account under Section 83 of the CGST Act/GGST Act was legally valid when the underlying proceedings were initiated under Section 71(1) of the GGST Act? Petitioner's argument: The petitioner argued that Section 83 of the CGST Act/GGST Act does not contemplate provisional attachment in respect of proceedings under Section 71(1) of the GGST Act, rendering the respondent's action without legal authority. Revenue's argument: The Revenue submitted that the attachment was made erroneously and was subsequently released by the respondent, thereby resolving the petitioner's grievance. They did not directly address the legality of the attachment concerning Section 71(1) proceedings but focused on the subsequent release.