Provisional attachment lapses by operation of law after the statutory period, and banks must be informed to restore account operation.

Provisional attachment under Section 45 of the Gujarat Value Added Tax Act operates only during pending assessment or reassessment proceedings and ceases to have effect after one year from the date of the order. Once that statutory period expires, the attached property and bank accounts cannot continue to be treated as under attachment. The authority must communicate the cessation of attachment to the banks so the account-holder can operate the accounts without further restraint.

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Issues: Whether the provisional attachment of the petitioner's property and bank accounts had ceased to operate on expiry of the statutory period, and whether the authority was required to communicate that position to the banks so that the accounts could be operated.

Analysis: The statutory scheme under Section 45 of the Gujarat Value Added Tax Act, 2003 provides for provisional attachment only during pending assessment or reassessment proceedings and makes such attachment cease to have effect after one year from the date of the order. Once that period expires, the attached property cannot continue to be treated as under attachment. In that situation, the authority must ensure that the banks are informed of the cessation of attachment so that the account-holder is not prevented from operating the accounts.

Conclusion: The provisional attachment had lapsed by operation of law, and the petitioner was entitled to operate the bank accounts. The authority was required to communicate the cessation of attachment to the banks.

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