Provisional attachment of taxpayer's in-state bank account under CGST s83 upheld; writ challenge dismissed for valid jurisdiction

Territorial jurisdiction to entertain the writ was upheld because part of the cause of action arose within the HC's territory: the impugned provisional attachment operated on a bank account located within the State and the taxpayer was registered there, notwithstanding that the attaching authority was situated elsewhere; the writ was held maintainable. On the legality of provisional attachment under s 83 CGST Act, the HC held that, on a conjoint reading of ss 1(2), 6(1), 83, 122(1) and 122(1A), relevant notifications/circulars, and the investigative material indicating contraventions, the statutory preconditions were satisfied and the attachment was within jurisdiction; the challenge failed and the writ petition was dismissed.

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Issues Involved:
1. Territorial jurisdiction under Article 226 of the Constitution of India.
2. Jurisdiction of respondent no. 1 to invoke Section 83 of the CGST Act for provisional attachment.
3. Legality and validity of the provisional attachment order under Section 83 of the CGST Act.

Summary:

Issue 1: Territorial Jurisdiction
The Court examined whether it had territorial jurisdiction under Article 226 to entertain the writ petition challenging the provisional attachment order dated 22.03.2023. The petitioner argued that since the bank account was maintained in Kolkata and the petitioner is a registered person in Kolkata, the High Court of Calcutta has jurisdiction. The Court agreed, stating that part of the cause of action arose within its territorial jurisdiction, making the writ petition maintainable.

Issue 2: Jurisdiction of Respondent No. 1
The petitioner contended that respondent no. 1 lacked jurisdiction to invoke Section 83 of the CGST Act for provisional attachment without initiating or having pending proceedings against the petitioner. The petitioner argued that the impugned order was issued without any proceedings under Chapters XII, XIV, and XV of the CGST Act, and thus, was non est in law. The Court, however, found that the CGST Guwahati authority had jurisdiction based on tangible material and the necessity to protect government revenue. The Court cited relevant sections and judgments to support its conclusion that the respondent's actions were legal and valid.

Issue 3: Legality and Validity of Provisional Attachment
The petitioner challenged the legality of the provisional attachment order, arguing that it was not issued in the prescribed format (Form GST DRC-22) and lacked the necessary conditions precedent. The petitioner also argued that the order was arbitrary and without jurisdiction. The Court examined the provisions of Section 83, Rule 159 of the CGST Rules, and relevant judgments. It concluded that the impugned order was issued in accordance with the law and within the jurisdiction of the CGST Guwahati authority. The Court dismissed the writ petition, upholding the legality and validity of the provisional attachment order.

Conclusion:
The High Court of Calcutta dismissed the writ petition, holding that it had territorial jurisdiction to entertain the petition. The Court found that the provisional attachment order issued by the CGST Guwahati authority was legal, valid, and within jurisdiction, and thus, not liable to be interfered with.

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