Court rectifies procedural error in bank account attachment under GST Act, stresses importance of fairness and due process.

The Gujarat High Court addressed the issue of provisional attachment of bank accounts under section 83 of the Central Goods and Services Tax Act, 2017 without serving a copy of the order on the petitioner. The court noted the procedural irregularity and directed for a notice to be issued to the petitioner, ensuring their right to respond effectively. The judgment emphasizes procedural fairness, the right to be informed, and the necessity of providing necessary documents for exercising legal rights. The court's intervention upheld principles of natural justice and due process in legal proceedings.

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Issues:
Provisional attachment of bank accounts under section 83 of the Central Goods and Services Tax Act, 2017 without serving a copy of the order on the petitioner.

Analysis:

The judgment delivered by the Gujarat High Court pertains to the provisional attachment of the petitioner's bank accounts under section 83 of the Central Goods and Services Tax Act, 2017. The court noted that although the provisional attachment had been made, the petitioner had not been served with a copy of the order under section 83 of the Act. The order of provisional attachment was issued to the concerned bank in Form DRC-22, as per rule 159(1) of the Central Goods and Services Tax Rules, 2017. However, sub-rule (5) of rule 159 allows any person whose property is attached to file an objection within seven days of attachment. The court observed that the general practice of the department was to issue provisional attachment orders to the concerned banks without providing a copy to the affected supplier. This raised a concern as to how the supplier could effectively file an objection under sub-rule (5) of rule 159 without being furnished with a copy of the order.

The court, while acknowledging the procedural irregularity in serving the petitioner with a copy of the provisional attachment order, directed for a notice to be issued. The notice, along with interim relief, was made returnable on 29th January 2019. The court permitted direct service of the notice on the same day, ensuring that the petitioner would be duly informed of the proceedings and have the opportunity to respond effectively.

In conclusion, the judgment highlights the importance of procedural fairness and the right of the affected party to be informed and provided with necessary documents to exercise their legal rights effectively. The court's intervention in ensuring proper notice and opportunity for the petitioner to respond underscores the principles of natural justice and due process in legal proceedings.

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