Brezza Exim Private Limited vs. State Of Maharashtra And Ors

Facts

The petitioner, Brezza Exim Private Limited, filed a writ petition challenging the continued attachment of its bank account. An order of provisional attachment under Section 83(1) of the Maharashtra Goods and Services Tax Act, 2017, was issued on June 1, 2019. The petitioner contended that as per Section 83(2) of the Act, the life of such an order is one year, and therefore, the attachment had ceased to be valid by operation of law. Despite the expiry of the validity period, the attachment had not been lifted. The petitioner relied on a coordinate bench's decision in a similar case, Implement Impex Private Limited vs. State of Maharashtra and Ors.

Held

The Court allowed the writ petition. It found that the provisional attachment order, issued on June 1, 2019, had indeed ceased to have validity by operation of law after one year, as mandated by Section 83(2) of the Maharashtra Goods and Services Tax Act, 2017. The Court acknowledged the petitioner's reliance on the decision in Implement Impex Private Limited vs. State of Maharashtra and Ors., and the revenue's concession that the present case was covered by that precedent. The ratio decidendi is that a provisional attachment order under Section 83(1) automatically lapses upon the expiry of its one-year validity period under Section 83(2), and the authorities are bound to lift such attachments. The Court directed the Assistant Commissioner of State Tax (D-20), Investigation-B, Mumbai, to immediately communicate to the petitioner's banker that the attachment order had ceased to be valid and that the petitioner was entitled to operate its bank account. This communication was to be issued within seven days from the date of the order.

Key Issues

1. Whether the provisional attachment order issued under Section 83(1) of the Maharashtra Goods and Services Tax Act, 2017, has ceased to be valid by operation of law, considering its one-year lifespan as stipulated in Section 83(2). The petitioner argued that the order of provisional attachment, issued on June 1, 2019, had expired by operation of law on June 1, 2020, as per Section 83(2) of the Act, which limits the validity of such an order to one year. They relied on the decision in Writ Petition No. 3710 of 2021 (Implement Impex Private Limited vs. State of Maharashtra and Ors.) to support their contention that the attachment should have been automatically lifted. The revenue (State of Maharashtra and Ors.) conceded that the issue was covered by the precedent cited by the petitioner and did not contest the petitioner's argument.