Sutantu Care Pvt. Ltd. Vs Superintendent CGST Anti Evasion & Anr. (Delhi High Court)
The Delhi High Court has directed the unfreezing of a company’s bank account, finding that a provisional attachment order issued by the tax authorities was no longer valid. In the case of Sutantu Care Pvt. Ltd. vs. Superintendent CGST Anti Evasion, the court ruled that the order of attachment had expired, was issued by an officer without proper authority, and did not meet the legal requirements for such an action. The court’s decision, issued after the tax department’s counsel conceded the invalidity of the order, provides a key clarification on the use of provisional attachments under the Central Goods and Services Tax (CGST) Act, 2017.
The petitioner, Sutantu Care Pvt. Ltd., had challenged a provisional attachment order dated April 27, 2022, that had frozen its bank account. The company raised three primary objections to the order. First, it argued that under Section 83(2) of the CGST Act, a provisional attachment order cannot be operative for more than one year. Since the order was issued in April 2022, its validity had expired in April 2023, rendering it legally null and void. Second, the petitioner contended that the order was not issued by a “Commissioner,” as required by Section 83 of the CGST Act, but by an officer of a lower rank who lacked the statutory authority to issue such a directive. Third, the petitioner claimed that the order did not reflect the mandatory legal condition that it was issued in the “interest of the Revenue,” as required by the Act.
