Case Law Details
Rd Enterprises Vs Union of India (Allahabad High Court)
The case of RD Enterprises vs. Union of India, adjudicated by the Allahabad High Court, revolves around the issue of provisional attachment of bank accounts under the GST Act. The petitioner, RD Enterprises, sought relief from the court to release their provisionally attached bank account, arguing that the attachment had expired according to Section 83(2) of the CGST Act, 2017.
The court initially heard arguments from both the petitioner’s counsel and the counsel representing the revenue authorities. After deliberation, the court issued an order on April 29, 2024, granting three days to the revenue counsel to provide further instructions. The case was scheduled for a fresh hearing on May 6, 2024.
On the latter date, the revenue counsel presented written instructions received from the Additional Director General of the Directorate General of Goods & Services Tax Intelligence Meerut Zonal Unit. These instructions acknowledged that the provisional attachment of RD Enterprises’ bank account, issued on February 16, 2023, had expired as per the provisions of Section 83(2) of the CGST Act, 2017, which states that such attachments cease to have effect after one year from the date of the order.
Based on these instructions, the revenue counsel conceded that the provisional attachment order should be lifted, allowing RD Enterprises to utilize their bank account as before. The court observed that similar instances of provisional attachment orders extending beyond the statutory one-year limit were becoming common, leading to unnecessary litigation. It noted that revenue authorities often rectify these errors only when challenged in court.
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