2022 (5) TMI 791 - HC - GST

Bank Account Provisional Attachment Under GST Section 83 To Be Reviewed Following Objection Process

The HC addressed the provisional attachment of the petitioner's bank account under Section 83 of CGST Act, 2017, following allegations of fake Input Tax ... Provisional attachment of Bank Accounts of petitioner - section 83 of CGST Act - case of petitioner is that the allegation of fake Input Tax Credits (ITCs) is against an entity going by the name Vibe Tradex, which is a proprietorship concern of Mr. Chaman Goel’s brother i.e., one, Mr. Chirag Goel and the the petitioner-company has nothing to do with Vibe Tradex - HELD THAT:- Having regard to the stand taken by Mr. Singh that under Rule 159(5) of the CGST Rules, 2017 (2017 Rules), the petitioner-company can file an objection to have the provisional attachment lifted, the writ petition is disposed off with the direction to the respondents/revenue, to treat the writ petition as an objection under sub-rule 5 of Rule 159 of the 2017 Rules - For this purpose, the authorized representative of the petitioner-company will present herself/himself before the concerned officer on 17.05.2022, at 11:30 P.M. - The concerned officer, after according personal hearing to the authorized representative of the petitioner-company, will pass a speaking order. Petition disposed off. Issues:1. Provisional attachment of bank account under Section 83 of the CGST Act, 2017.2. Allegation of fake Input Tax Credits against a related entity.3. Dispute regarding common vendors between two entities.4. Petitioner's cooperation in the investigation.5. Disposal of the writ petition as an objection under Rule 159(5) of the CGST Rules, 2017.Analysis:1. The petitioner's bank account was provisionally attached under Section 83 of the CGST Act, 2017. The petitioner's grievance was that its bank account at ICICI Bank had been provisionally attached. It was acknowledged that the attachment was made under Section 83 of the CGST Act, 2017. The petitioner's director had obtained anticipatory bail, indicating cooperation in the investigation.2. There were allegations of fake Input Tax Credits against an entity named Vibe Tradex, which was a concern of the petitioner's director's brother. The petitioner distanced itself from Vibe Tradex, stating no involvement. However, common vendors were identified between the petitioner and Vibe Tradex, such as Transglobe Tradex Pvt. Ltd. and M/s Tirupati Overseas.3. The petitioner's cooperation in the investigation was highlighted. The petitioner's counsel stated that the petitioner was actively cooperating with the revenue authorities in the ongoing investigation. The court refrained from making any comments on the ongoing investigation but directed the revenue to consider the writ petition as an objection under Rule 159(5) of the CGST Rules, 2017.4. The court directed the petitioner to present itself before the concerned officer to have the provisional attachment lifted. The officer was instructed to provide a personal hearing and pass a speaking order within three days. If the order was adverse, the petitioner could challenge it. The court also cited relevant judgments supporting the petitioner's case, emphasizing their consideration in the decision-making process.5. The writ petition was disposed of with the above directions, and pending applications were closed. The parties were instructed to act based on the digitally signed copy of the order, ensuring compliance with the court's directives and decisions.