Bank account freezing under CGST upheld as petitioners must use Rule 159(5) for objections instead of judicial intervention

HC dismissed petition challenging bank account freezing under CGST proceedings. Court held petitioners should utilize sub-rule (5) of Rule 159 CGST Rules to file objections against attachment orders rather than seeking judicial intervention. Following precedent in Ashok Kumar Vishwakarma case, HC declined to exercise discretionary jurisdiction under Article 226, directing petitioners to pursue statutory remedy of filing representation/objection against attachment through prescribed procedural mechanism.

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Issues involved:
The issues involved in the judgment include challenging the legality and validity of a notice/order, freezing of bank accounts, recovery of GST amounts, and defreezing of credit ledger balance.

Challenge to Notice/Order:
The petition filed under Article 226 sought to quash and set aside a notice/order dated 25th August, 2023, along with any consequential notices and actions taken, including freezing the bank account. Additionally, the petition sought to restrain the respondents from attaching any of the petitioner's bank accounts.

Recovery of GST Amounts:
The court directed Respondent Nos. 2 and 3 to initiate action against Respondent No. 6 for the recovery of GST amounts for services provided to the petitioner. The petition also requested the court to stay the effect of the impugned notice/order and to direct the respondents to refrain from blocking certain accounts.

Defreezing of Accounts:
The court directed Respondent No. 4 to raise the debit freeze on specific accounts held by the petitioner. Furthermore, the court instructed Respondent No. 5 to refrain from blocking certain accounts and to raise the debit freeze imposed on the electronic credit ledger.

Representation Against Attachment:
Considering the peculiar facts of the case, the court permitted the petitioners to file objections against the attachment of their property as per sub-rule (5) of Rule 159 of the CGST Rules. The petitioners were directed to make a representation/objection to Respondent No. 2 within a specified timeline for expeditious disposal.

Conclusion:
The court disposed of the petition, allowing the petitioners to raise objections against the attachment of their property. The petitioners were granted the opportunity to make a representation to the concerned authority within a week, with a directive for expeditious disposal. All contentions of the parties were expressly kept open, and the judgment was concluded with no costs imposed.

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