Ufv INDIA Global Education vs. Union Of INDIA And Ors

Held

The Court held that the provisional attachment of the bank account under Section 83 of the Central Goods and Services Tax Act, 2017, was patently illegal. The Court reasoned that Section 83 clearly stipulates that provisional attachment can only be made during the pendency of proceedings under Sections 62, 63, 64, 67, 73, or 74. Since the proceedings under Section 67 had concluded, and no other proceedings under the mentioned sections had been initiated, the basis for the provisional attachment ceased to exist. The Court followed the principle laid down in Kushal Ltd. Vs. Union of India, emphasizing that the pendency of proceedings is a mandatory requirement for the exercise of powers under Section 83. Therefore, the impugned orders were set aside, and the respondents were directed to release the provisionally attached bank account forthwith.

Facts

The petitioner, UFV India Global Education, which conducts academic programs in India for the University of Fraser Valley, Canada, had its bank account provisionally attached under Section 83 of the Central Goods and Services Tax Act, 2017. This attachment was initiated following proceedings under Section 67 of the Act. The petitioner filed objections, arguing that urgent payments were necessary. The authorities partly released the bank account for Amnesty Scheme payments but rejected the full release, stating the petitioner had no other assets to secure government revenue. The petitioner challenged the attachment order dated 29.07.2020, the intimation letter dated 29.07.2020, and the rejection order dated 06.08.2020.

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, is valid when the proceedings under Section 67 of the Act, which initiated the attachment, have concluded, and no further proceedings under Sections 63 or 74 have been initiated. Petitioner's arguments: The petitioner contended that the provisional attachment under Section 83 became redundant as the proceedings under Section 67 were over, and no other proceedings under Section 63 or 74 had been initiated. They relied on the Gujarat High Court's decision in Kushal Ltd. Vs. Union of India, which held that pendency of proceedings under the specified sections is a sine qua non for exercising powers under Section 83. Respondents' arguments: The respondents argued that the proceedings under Section 83 were initiated because proceedings under Section 67 had been launched, and these could culminate into proceedings under Section 63 or 74.