CGST Act: Court Restores Provisionally Attached Property, Emphasizes Statutory Compliance

The Court resolved the issue of the continuation of provisional attachment of property under Section 83 of the CGST Act beyond one year by directing the restoration of the provisionally attached property. The Court emphasized strict compliance with statutory provisions and cautioned against unnecessary approaches to the Court for compliance. Despite the case warranting costs, the Court disposed of the petition without imposing any costs on the parties involved.

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Issues:
1. Continuation of provisional attachment of property under Section 83 of the CGST Act beyond one year.

Analysis:
The writ petition sought direction against respondent No.4 to release the provisional attachment of the property under Section 83 of the Central Goods and Services Tax Act. The petitioner argued that continuing the attachment after one year is violative of the provisions. The prayers included directing the release of attachment, issuing necessary orders, and awarding costs. The Assistant Commissioner of State Tax denied the allegations, stating that the issue pertained to specific assessment years and the relevant provisions of the GST Act applied. The respondent lifted the bank attachment and initiated steps to lift the attachment for immovable property as the statutory period had elapsed. The respondent requested a bank guarantee due to the substantial tax dues.

The Court heard arguments from both sides, with the petitioner seeking to challenge the provisional attachment order passed by the respondents before the mandatory one-year period. The petitioner, a partnership firm engaged in manufacturing and exports, was aggrieved by the attachment of its properties. The Court noted the sequence of events, including the issuance of notices and the attachment of factory and residential premises. The Court had previously quashed certain orders but did not disturb the provisional attachment. The petitioner raised concerns about contradictory actions by the respondent and subsequent legal proceedings.

The main issue before the Court was the continuation of the attachment beyond one year, as prescribed under Section 83 of the CGST Act. The Court noted that the provisional attachment order had continued despite the passage of the statutory period. However, with an order issued on 23.09.2021 directing the restoration of provisionally attached property, the cause for the petition was deemed resolved. The Court emphasized the need for strict compliance with statutory provisions and warned against unnecessary approaches to the Court for such compliance. The Court disposed of the petition without imposing costs, despite the case warranting such imposition.

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