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of <h1>Court quashes illegal bank account attachment under GST Act, stresses statutory compliance</h1> <h3>Proex Fashion Private Limited Versus Government Of India & Ors.</h3> Proex Fashion Private Limited Versus Government Of India & Ors. - [2021] 85 G S.T.R. 397 (Del), 2021 (51) G.S.T.L. 133 (Del.) Issues Involved:1. Legality of the provisional attachment of the petitioner's bank account under Section 83 of the Central Goods and Services Tax Act, 2017.2. Compliance with statutory requirements for invoking Section 83.3. Consequences of the attachment order on the petitioner.Detailed Analysis:Issue 1: Legality of the provisional attachment of the petitioner's bank account under Section 83 of the Central Goods and Services Tax Act, 2017The petitioner challenged the communication dated 25.11.2020/01.12.2020, whereby their bank account was attached by respondent no. 2 under Section 83 of the Central Goods and Services Tax Act, 2017 ('the Act'). The petitioner contended that the attachment was pursuant to proceedings under Section 71 of the Act, which does not justify invoking Section 83.Issue 2: Compliance with statutory requirements for invoking Section 83The court examined the statutory provisions, including Sections 67, 71, and 83 of the Act. Section 83 allows for provisional attachment of property during the pendency of proceedings under Sections 62, 63, 64, 67, 73, or 74 of the Act. The court noted that the attachment order was based solely on proceedings under Section 71, which is not listed in Section 83. The court referred to the decision in *Kaish Impex Private Limited vs. Union of India & Ors.*, where it was held that Section 83 cannot be invoked unless proceedings under the specified sections are pending.The court reiterated that Section 83 is a drastic power and must be exercised within its well-defined ambit. The statutory preconditions for invoking Section 83 were not met in this case, as no proceedings under the relevant sections were initiated against the petitioner.Issue 3: Consequences of the attachment order on the petitionerThe court acknowledged the severe consequences of attaching a bank account, especially for a running concern like the petitioner. It emphasized that such power must be exercised in strict compliance with statutory provisions. Given the absence of statutory preconditions, the court found the attachment order to be wholly illegal and unsustainable.Conclusion:The court quashed the impugned order dated 25.11.2020/01.12.2020 as ultra vires the statutory powers of respondent no. 2. The court clarified that this order does not preclude the respondents from taking lawful action against the petitioner, including passing orders under Section 83 in accordance with statutory conditions. The petitioner assured the court of their cooperation in providing information and documents as required by respondent no. 2. The writ petition was allowed, and the pending application was disposed of.
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