2024 (8) TMI 641 - HC - GST

Legal Challenge Invalidates GST Recovery Order: Procedural Defects Halt Attachment of Bank Accounts Under DRC-07

HC found the summary order in GST DRC-07 legally invalid due to absence of formal order. Court quashed the recovery actions and directed respondents to ... Release of attached bank accounts - challenge to summary order - HELD THAT:- On perusal of the summary of the order dated 13.08.2019 placed at Annexure-A to the petition, it only says the order no., order date:14.06.2019, Tax Period: April 2018 to September 2018 and issues involved is difference of Rs. 94,71,738/- between GSTR-3B and GSTR-2A. In absence of any order for which the summary of the order was issued on 13.08.2019, the same cannot be sustained and accordingly, the Annexure-A, summary of the order dated 13.08.2019 in Form GST DRC-07 is hereby quashed and set aside and the consequent action for recovery on the basis of such summary of the order in absence of any order passed under any of the provisions of the Act is also quashed and set aside including the attachment of the bank accounts of the petitioner. The respondents are directed to pass an appropriate order for lifting the attachment of the bank accounts of the petitioner forthwith - the petition is disposed of. Issues:1. Petition for writ of mandamus or certiorari regarding summary of order in Form GST DRC-07 dated 13.8.2019 under Section 161 of the GST Acts.2. Action taken for recovery based on summary of the order without a formal order being made available to the petitioner.3. Lack of legal validity of summary of order without an actual order being passed.4. Quashing of the summary of order in Form GST DRC-07 dated 13.08.2019 and related recovery actions.5. Direction to lift the attachment of the petitioner's bank accounts.Analysis:The petitioner sought relief through a writ of mandamus or certiorari concerning the summary of order in Form GST DRC-07 dated 13.8.2019 under Section 161 of the GST Acts. The court noted discrepancies in the actions taken by the respondents for recovery based on the summary of the order without providing the petitioner with a formal order. The court directed the respondents to explain their actions for recovery based on the summary of the order before the next hearing date, emphasizing the lack of legal validity of the summary without an actual order being passed.The court further observed that the summary of the order in Form GST DRC-07 dated 13.08.2019 lacked legal standing as there was no formal order available to support it. Despite references to an order dated 14.06.2019 in the summary, the respondent could not provide evidence of such an order. Consequently, the court quashed the summary of the order and all related recovery actions, including the attachment of the petitioner's bank accounts. The respondents were directed to lift the attachment of the bank accounts promptly.In conclusion, the court disposed of the petition, discharged the notice, and permitted direct service through Email. The judgment highlighted the importance of legal validity and due process in actions taken based on official orders, emphasizing the necessity for proper documentation and adherence to legal procedures in matters of recovery and attachment of assets.