Provisional attachment under VAT law lapses after one year unless a fresh order is made on current facts.

Section 45 of the VAT Act permits provisional attachment only during pending assessment or reassessment proceedings and limits each attachment order to one year. The statutory scheme does not allow an attachment to continue automatically beyond that period; if protection of revenue is still considered necessary, the authority must pass a fresh order after reviewing the prevailing position. The earlier order therefore lapses on expiry of one year and cannot operate indefinitely.

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Issues: Whether a provisional attachment made under section 45 of the VAT Act ceases to have effect after one year and whether continuation of such attachment requires a fresh order.

Analysis: Section 45 empowers the competent authority to provisionally attach a dealer's property during pendency of assessment or reassessment proceedings where such attachment is necessary to protect Government revenue. The provision also expressly limits the life of every provisional attachment to one year from the date of the order. The statutory scheme does not permit an indefinite continuation of the same attachment order. If the authority considers attachment still necessary after expiry of the prescribed period, it must pass a fresh order after considering the current position; the earlier order does not continue mechanically beyond one year.

Conclusion: The provisional attachment orders dated 07.09.2016 and 08.09.2016 ceased to have effect on expiry of one year and could not continue thereafter.

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