Himanshu Infraprojects PVT. LTD. vs. Commissioner, Central Goods And Service Tax, Rohtak And Another

Facts

The petitioner, Himanshu Infraprojects Pvt. Ltd., filed a writ petition challenging an order attaching its bank account and seeking a refund of Rs. 63,00,000. The petitioner contended that the bank account was attached by the Assistant Commissioner without a proper show cause notice or demand. The respondents argued that the attachment order was passed with the Commissioner's consent and that the amount in question was voluntarily deposited by the petitioner, with a show cause notice for additional duty subsequently issued. The petitioner relied on Section 83 of the CGST Act, 2017, regarding provisional attachment to protect revenue.

Held

The Court held that the order of attachment of the bank account had to be set aside. It reasoned that if the Commissioner's written order is not communicated to the assessee, the assessee cannot know the reasons for the attachment and thus cannot file effective objections. This would deprive the assessee of the benefit of challenging the attachment. Regarding the refund of Rs. 63,00,000, the Court followed its own Division Bench judgment in Concepts Global Impex Vs. Union of India. In that case, despite a subsequent show cause notice, the Court directed the refund of the deposited amount after retaining 10% of the demanded duty. The Court found the judgment of the Delhi High Court in Ambay Industrial Corporations to be less binding than its own Division Bench precedent. Therefore, the prayer for refund was disposed of in the same terms as in the Concepts Global Impex case, implying a partial retention of the deposited amount. The Court expressly left undecided any issue regarding the merits of the subsequent show cause notice.

Key Issues

1. Whether the provisional attachment of the petitioner's bank account under Section 83 of the Central Goods and Services Tax Act, 2017, was validly passed, considering the authority and communication of reasons for attachment. 2. Whether the petitioner is entitled to a refund of Rs. 63,00,000, which was deposited without a pending show cause notice or demand, despite a subsequent show cause notice being issued. Petitioner's arguments: The petitioner argued that the order of attachment was passed by the Assistant Commissioner, not the Commissioner as required by Section 83 of the CGST Act, and that the lack of communication of the Commissioner's reasons prevented them from filing effective objections. Regarding the refund, the petitioner relied on the Division Bench judgment of this Court in Concepts Global Impex Vs. Union of India, which directed refund of amounts deposited under similar circumstances. Respondents' arguments: The respondents contended that the attachment order was passed with the Commissioner's consent. They argued that the Rs. 63,00,000 was voluntarily deposited by the petitioner and that a show cause notice demanding more duty had been sent. They cited the Delhi High Court judgment in Ambay Industrial Corporations Vs. Union of India, suggesting a suit for recovery as an alternative remedy.