Court quashes freezing orders, stresses due process. Respondents to withdraw orders. Importance of legal procedures

The court quashed the freezing orders on the petitioner's bank accounts, emphasizing the importance of following due process before taking such drastic actions. The respondents were directed to withdraw the freezing orders and inform the banks accordingly. Despite considering imposing costs on the respondents, the court refrained from doing so, hoping for compliance with court decisions in the future. The judgment highlighted the significance of completing investigations, issuing show cause notices, and following proper legal procedures to avoid severe impacts on businesses.

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Issues involved:
Challenge to letters freezing bank accounts without issuance of show cause notice or completion of investigations.

Analysis:
The petition challenged letters from the Directorate of Revenue Intelligence freezing the petitioner's bank accounts without issuing show cause notices or completing assessments. The petitioner, engaged in import/export trading of diamonds, argued that the freezing of accounts virtually halted their business operations. The court noted that similar cases in the past had seen such actions being set aside. The respondents defended their actions by stating that the freezing was to secure amounts owed by the petitioner in connection with confiscated goods. However, the court found that no show cause notice had been issued, and assessments were pending. The court referred to previous judgments where similar actions were deemed unjustified without proper legal procedures being followed.

The court highlighted that freezing bank accounts without completing investigations or issuing show cause notices could severely impact businesses. Citing previous cases, the court emphasized the importance of following due process before taking such drastic actions. The respondents were directed to withdraw the freezing orders and intimate the banks accordingly. Despite considering imposing costs on the respondents for persisting with such actions against court rulings, the court refrained from doing so, expressing hope for compliance with court decisions in the future.

In conclusion, the court quashed the freezing orders on the petitioner's bank accounts, following the principles and reasoning from previous judgments. The court emphasized the need for proper legal procedures, including issuing show cause notices and completing assessments before taking actions that could significantly affect businesses. The respondents were directed to inform the banks about the setting aside of the freezing orders.

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