Case Law Details
Parthavi Metal And Alloys Vs Union Of India & Ors. (Delhi High Court)
In the case of Parthavi Metal And Alloys vs. Union Of India & Ors., heard in the Delhi High Court, the petitioner challenges an order dated 04.08.2022 passed under Section 83 of the Central Goods and Services Tax Act, 2017 (CGST Act), which provisionally attached the cash credit accounts of the petitioners.
The petitioner, represented by learned counsel, argues that according to Section 83(2) of the CGST Act, the maximum period for attachment of cash credit accounts is one year from the date the order is made under Section 83(1) of the CGST Act. Since the orders in question have ceased to operate, the petitioner contends that there should be no impediment to them operating the cash credit accounts.
The counsel for the respondents concedes to the statutory position that orders passed under Section 83(1) of the CGST Act, provisionally attaching cash credit accounts, have a lifespan of only one year and cease to operate after that period expires.
However, the counsel for the respondents informs the court that a fresh attachment order dated 13.12.2023 has been passed, once again provisionally attaching the cash credit accounts under Section 83(1) of the CGST Act.
The petitioner’s counsel argues that the repeated attachment of cash credit accounts under Section 83 of the CGST Act is a violation of the provisions of Section 83(2), and such actions should not have been undertaken. Furthermore, the petitioner states that they have not received copies of the attachment order dated 13.12.2023.
In light of the above, considering that the order under scrutiny in these proceedings has ceased to be operative, the court disposes of the petition while reserving the petitioner’s right to challenge the fresh attachment order dated 13.12.2023 in accordance with the law. The court leaves open the question of the validity of repeated issuance of attachment orders under Section 83 of the CGST Act.
All rights and contentions of the parties are reserved, allowing for further legal recourse if necessary.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
Petitioner impugns order dated 04.08.2022 passed under Section 83 of the Central Goods and Services Tax Act, 2017 [“CGST Act”], provisionally attaching the cash credit accounts of the petitioners.
2. Learned counsel for the petitioner submits that maximum period for attachment of cash credit accounts in terms of Section 83(2) of the CGST Act is a period of one year from the date the order is made under Section 83(1) of the CGST Act. He submits that since orders have ceased to operate, there can be no impediment in petitioners operating the cash credit accounts.
3. Learned counsel for the respondents concede to the statutory position that orders passed under Section 83(1) of the CGST Act provisionally attaching the cash credit accounts have a life of only one year and cease to operate after the expiry of period of one year from the date it is made.
4. Learned counsel, however, submits that fresh attachment order dated 13.12.2023 has been passed once again provisionally attaching the cash credit accounts under Section 83(1) of the CGST Act.
5. Learned counsel for the petitioners submits that repeated attachment of cash credit accounts in exercise of power under Section 83 of the CGST Act is in breach of the provisions of Section 83(2) and such exercise could not have been undertaken. He further submits that petitioners have not received copies of attachment order dated 13.12.2023.
6. In view of the above, admitted position that the order, subject matter of these proceedings has ceased to operate, the petition is disposed of reserving the right of the petitioner to impugn the fresh attachment order dated 13.12.2023 in accordance with law. The question of validity of repeated issuance of attachment orders under Section 83 of the CGST Act is left open.
7. All rights and contentions of parties are reserved.
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