TaxTMI 
TaxTMI 
2020 (10) TMI 1214
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....ranch Type of Account Account Number 1. KOTAK MAHINDRA BANK LTD., 1 to 5, Surya Plaza, Near Udhna Darwaja, Ring Road, Surat. Current Account 1511785097 2. KOTAK MAHINDRA BANK LTD. 1 to 5, Surya Plaza, Near Udhna Darwaja, Ring Road, Surat. Current Account 1513858713 3. KOTAK MAHINDRA BANK LTD., 1 to 5, Surya Plaza, Near Udhna Darwaja, Ring Road, Surat. Current Account 1513969471 4. KOTAK MAHINDRA BANK LTD., 1 to 5, Surya Plaza, Near Udhna Darwaja, Ring Road, Surat. Current Account 1514001668 5. KOTAK MAHINDRA BANK LTD., 1 to 5, Surya Plaza, Near Udhna Darwaja, Ring Road, Surat. CC Account 510044001836 And that is how, debt may be allowed to be made from said accounts. (D) Pending admission, hearing and final disposal of the matter, Your Lordship may be pleased to grant an ex-parte ad interim order in favour of Petitioner herein in terms of prayer clause (c) hereinabove. (E) To award costs of any incidental to this application be paid by the Respondents. (F) Your Lordships may be pleased to grant such other further relief(s) that may be deemed fit and proper in the interest of justic....
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....l institution>> having account no:-1511785097 Or Property located at property ID & location- In order to protect the interests of revenue and in exercise of the powers conferred under section 83 of the Act, I Devendra .J. Bamaniya, (name), Assistant Commissioner of State Tax (designation), hereby provisionally attach the aforesaid account/property to the extent of available balance. No debit shall be allowed to be made from the said account or any other account operated by the aforesaid person on the same PAN without the prior permission of this department. Or The property mentioned above shall not be allowed to be disposed of without the prior permission of this department." 4. A bare perusal of the order of provisional attachment, referred to above, would indicate that the same is nothing but a result of mechanical exercise of power under Section 83 of the Act, 2017. Section 83 of the Act, 2017 reads as under: "SECTION 83. Provisional attachment to protect revenue in certain cases. - (1) Where during the pendency of any proceedings under section 62 or section 63 or section 64 or section 67 or section 73 or section 74, the Comm....
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....s although the sufficiency of the reasons for the belief cannot be investigated by the Court. In the case at hand, The learned A.G.P. appearing for the respondents very fairly submitted that not only the impugned order of provisional attachment is bereft of any reason, but there is nothing on the original file on the basis of which this Court may be in a position to ascertain the genuineness of the belief formed by the authority. The word "necessary" means indispensable, requisite; indispensably requisite, useful, incidental or conducive; essential; unavoidable; impossible to be otherwise; not to be avoided; inevitable. The word "necessary" must be construed in the connection in which it is used. The formation of the opinion by the authority should reflect intense application of mind with reference to the material available on record that it had become necessary to order provisional attachment of the goods or the bank account or other articles which may be useful or relevant to any proceedings under the Act. [see: Bhikhubhai Vithlabhai Patel and others vs. State of Gujarat AIR 2008 SCC 1771]. 6. In J. Jayalalitha vs. U.O.I. [AIR 1999 SC 1912], the Supreme Court while construing ....
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....legislature enacted S. 637 (i) (a) it knew that government would entrust to the Board its power under S. 237 (b). Could the legislature have left without any restraints or limitations the entire power of ordering an investigation to the subjective decision of the Government or the Board? There is no doubt that the formation of opinion by the Central Government is a purely subjective process. There can also be no doubt that since the legislature has provided for the opinion of the government and not of the court such an opinion is not subject to a challenge on the ground of propriety, reasonableness or sufficiency. But the Authority is required to arrive at such an opinion from circumstances suggesting what is set out in sub-clauses (i), (ii) or (iii). If these circumstances were not to exist, can the government still say that in its opinion they exist or can the Government say the same thing where the circumstances relevant to the clause do not exist? The legislature no doubt has used the expression "circumstances suggesting". But that expression means that the circumstances need not be such as would conclusively establish an intent to defraud or a fraudulent or illegal purpose. Th....
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....o the construction that the process of entertaining "reason to believe" or "the opinion" is an altogether subjective to process not lending itself even to a limited scrutiny by the court that such "a reason to believe" or "opinion" was not formed on relevant facts or within the limits or as Lord Radcliffe and Lord Reid called the restraints of the statute as an alternative safeguard to rules of natural justice where the function is administrative." 9. In the Income-tax Officer, Calcutta and Ors. vs. Lakhmani Mewal Das [AIR 1976 SC 1753], the Supreme Court construed the expression "reason to believe" employed in Section 147 of the Income-Tax Act, 1961 and observed: the reasons for the formation of the belief must have a rational connection with or relevant bearing on the formation of the belief. Rational connection postulates that there must be a direct nexus or live link between the material coming to the notice of the Income-tax Officer and the formation of his belief that there has been escapement of the income of the assessee from assessment in the particular year because of his failure to disclose fully or truly all material facts. It is not any or every material, howsoever ....
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....venge, but in law this does not affect his exercise of his power. In the same way a private person has an absolute power to allow whom he likes to use his land, to release a debtor, or, where the law permits, to evict a tenant, regardless of his motives. This is unfettered discretion. But a public authority may do none of these things it acts reasonably and in good faith and upon lawful and relevant grounds of public interest. The whole conception of unfettered discretion is inappropriate to a public authority, which possesses powers solely in order that it may use them for the public good. There is nothing paradoxical in the imposition of such legal limits. It would indeed be paradoxical if they were not imposed." 33. The Court is entitled to examine whether there has been any material available with the State Government and the reasons recorded, if any, in the formation of opinion and whether they have any rational connection with or relevant bearing on the formation of the opinion. The Court is entitled particularly, in the event, when the formation of the opinion is challenged to determine whether the formation of opinion is arbitrary, capricious or whimsical. It is al....
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.... disclose fully and truly all material facts. It is no doubt true that the Court cannot go into the sufficiency or adequacy of the material and substitute its own opinion for that of the I.T.O. on the point as to whether action should be initiated for reopening the assessment. At the same time we have to bear in mind that it is not any and every material, howsoever vague and indefinite or distant, remote and farfetched, which would warrant the formation of the belief relating to escapement of the income of the assessee from assessment. The reason for the formation of the belief must be held in good faith and should not be a mere pretence." 13. A Coordinate Bench of this Court, to which one of us J.B. Pardiwala, J. was a party, had the occasion to discuss Section 83 of the Act in the case of Valerius Industries vs. Union of India, Special Civil Application No.13132 of 2019, decided on 28th August, 2019, wherein this Court drew the following conclusion: "[1] The order of provisional attachment before the assessment order is made, may be justified if the assessing authority or any other authority empowered in law is of the opinion that it is necessary to protect the intere....