Court quashes attachment orders, upholds legal entity separation, emphasizing natural justice principles.

The court allowed the writ application, quashing the attachment orders dated 23.01.2018 and 14.05.2018. It held that the petitioner company's property could not be attached for the tax dues of respondent no.3 company as they are separate legal entities. The court emphasized that the failure to consider the petitioner's objections and the issuance of a non-speaking order violated principles of natural justice. The court specified that respondent no.3's plant and machinery could be attached, but not the petitioner company's land.

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Issues Involved:
1. Legality of the attachment of the petitioner's property under Sections 46, 47, and 48 of the Gujarat Value Added Tax Act (GVAT Act).
2. Distinction between the petitioner company and respondent no.3 company as separate legal entities.
3. Consideration of the petitioner's objections by respondent no.2.
4. Validity of the attachment order as a non-speaking order.

Issue-wise Detailed Analysis:

1. Legality of the attachment of the petitioner's property under Sections 46, 47, and 48 of the GVAT Act:
The petitioner challenged the attachment orders dated 23.01.2018 and 14.05.2018, arguing that the property of the petitioner company was attached for the tax dues of respondent no.3 company. The court noted that the petitioner company is the lawful owner of the property in question and had entered into a lease deed with respondent no.3 company. The court emphasized that under Section 45 of the GVAT Act, provisional attachment can only be made of the property belonging to the defaulting dealer. The court concluded that the property of the petitioner company, which is not the defaulting dealer, could not have been attached for the tax dues of respondent no.3.

2. Distinction between the petitioner company and respondent no.3 company as separate legal entities:
The petitioner argued that the petitioner company and respondent no.3 company are separate legal entities, and therefore, the property of the petitioner company could not be attached for the dues of respondent no.3 company. The court agreed with this argument, stating that the petitioner company is a separate legal entity and the property in question belongs to the petitioner company. The court rejected the argument that the attachment was justified because the directors of the petitioner company were also directors of respondent no.3 company.

3. Consideration of the petitioner's objections by respondent no.2:
The petitioner contended that their objections were not considered by respondent no.2, and the impugned order was a non-speaking order. The court observed that the objections of the petitioner were indeed not considered, and the order passed by respondent no.2 was a non-speaking order. The court held that the failure to consider the objections and the issuance of a non-speaking order were contrary to the principles of natural justice.

4. Validity of the attachment order as a non-speaking order:
The petitioner argued that the attachment order was a non-speaking order, which did not provide any reasons for the attachment. The court agreed with this argument, noting that the order did not provide any reasons for the attachment and was therefore arbitrary and illegal. The court emphasized that any order affecting the rights of a party must be a speaking order, providing reasons for the decision.

Conclusion:
The court allowed the writ application, quashing and setting aside the impugned orders dated 23.01.2018 and 14.05.2018. The court held that the property of the petitioner company could not be attached for the tax dues of respondent no.3 company, as the petitioner company and respondent no.3 company are separate legal entities. The court also held that the failure to consider the petitioner's objections and the issuance of a non-speaking order were contrary to the principles of natural justice. The court clarified that the plant and machinery belonging to respondent no.3 could be attached, but not the land belonging to the petitioner company.

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