Jay Ambey Filament Pvt. Ltd Vs Union of India (Gujarat High Court)
The present petition is filed to seek the permission for releasing the provisional attachment of the five banks accounts of a person accused of tax evasion under Section 74(1) of the CGST Act.
High Court states that, 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 interest of revenue. However, the subjective satisfaction should be based on some credible materials or information and also should be supported by supervening factor. It is not any and every material, howsoever vague and indefinite or distant remote or far-fetching, which would warrant the formation of the belief. The power of provisional attachment under Section 83 of the Act should be exercised by the authority only if there is a reasonable apprehension that the assessee may default the ultimate collection of the demand that is likely to be raised on completion of the assessment. It should, therefore, be exercised with extreme care and caution. The authority before exercising power under Section 83 of the Act for provisional attachment should take into consideration two things: (i) whether it is a revenue neutral situation (ii) the statement of “output liability or input credit”. Having regard to the amount paid by reversing the input tax credit if the interest of the revenue is sufficiently secured, then the authority may not be justified in invoking its power under Section 83 of the Act for the purpose of provisional attachment.” HC are of the view that none of the above referred conditions are fulfilled in the present case. In the result, this writ application stands allowed. The order of provisional attachment of the five bank accounts of the writ applicant under Section 83 of the Act is quashed and set aside.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs:-
“(A) Your Lordships may be pleased to admit this Petition.
(B) Your Lordship may be pleased to allow this petition.
(C ) Your Lordship may be pleased to issue writ of mandamus or any other appropriate writ directing the Respondent No.4 to immediately remove attachment of following Bank Acccount belonging to Petitioner No.1 Company
