Kesari Nandan Mobile Vs Office of Assistant Commissioner of State Tax (Supreme Court of India)
The Supreme Court of India, in the case of Kesari Nandan Mobile vs. Office of Assistant Commissioner of State Tax, addressed the legality of a provisional attachment order under Section 83 of the Central Goods and Services Tax Act, 2017 (CGST Act). The appellant, Kesari Nandan Mobile, challenged a decision by the Gujarat High Court that upheld a second set of provisional attachment orders issued by the tax authority. These new orders were issued after the initial attachment, which was valid for one year, had lapsed. The tax authority, after the initial attachment orders from October 2023 had expired in October 2024, issued fresh orders in November and December 2024, effectively “renewing” the attachment of the appellant’s bank accounts.
The appellant’s counsel, Mr. Dave, argued that the CGST Act does not have a provision for extending or renewing a provisional attachment order after the one-year period stipulated in Section 83(2) has expired. He contrasted this with the Central Excise Act, 1944 and the Customs Act, 1962, both of which explicitly allow for the extension of a provisional attachment, though for a limited period. He contended that the absence of a similar provision in the CGST Act indicates the legislature’s intent that such an attachment should have a limited lifespan. Mr. Dave also cited a prior Supreme Court order in RHC Global Exports Private Limited & ors. v. Union of India & ors. where a bank account attachment was lifted after a year. Additionally, he highlighted a differing opinion from the Kerala High Court in Additional Director General & anr. v. Ali K. & ors. which held that re-issuing an attachment order on the same property after the initial order has ceased is not the legislative intent of the CGST Act. The counsel also brought to the court’s attention that the tax authority failed to address the appellant’s representation against the initial attachment, as required by Rule 159(5) of the CGST Rules, and that the renewed orders were based on a similar, if not identical, satisfaction note.
