RR India Pvt. Ltd Vs Union Of India & Ors. (Delhi High Court)
The period of 7 days prescribed in rule 159(5) of the CGST Rules for moving the objections to the provisional attachment is merely directory and not mandatory.
Assessee contends that under the CGST Act or Rules, there is no provision which mandates the filing of objections to provisional attachment within 7 days. No consequence of delay in filing objections is provided. Moreover, the respondent does not suffer any adverse consequence on account of delay on the part of the objector in moving the objections which is beyond the period of 7 days of the date of the provisional attachment.
Department contends that sub-Rule 5 of Rule 159 stipulates that the person whose property is attached, may within 7 days of attachment under sub-Rule (1), file an objection, the petitioner ought to have filed the same within the aforesaid stipulated period. Since, admittedly, the objections were preferred beyond the period of 7 days, respondent were bound to reject the same.
Held
It is clear to us that the period of 7 days prescribed in Rule 159(5) is a directory and not a mandatory period. Therefore, on account of delay on the part of the objector, if he prefers his objections beyond the period of 7 days, the objections cannot be rejected on the ground of limitation. No consequence is prescribed either in the Act or in the Rules to say that if the objections are not preferred within 7 days, they shall not be entertained.
The decision in Sambha Ji Vs. Gangabai, 2009 (240) ELT 161 (SC) is clearly attracted to the present Moreover, it is the objector who would suffer adverse consequence on account of delay on his part in raising the objections. The respondents do not suffer any adverse consequence on account of delay, if any, in moving the objections. We, therefore, hold that the period of 7 days prescribed in Rule 159(5) of the CGST Rules for moving the objections to the provisional attachment is merely directory and not mandatory. Objections raised by the petitioner, therefore, could not be rejected on that ground alone.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
1. The petitioner has preferred the present writ petition to seek the following reliefs:-
“a) quash and set aside the impugned orders dated 6.2 .2020, 2.12.2019 & 3.12.2019;
b) declare Rule 159(5) of the Rules to the extent it specifies the time period of seven days as ultra-vires of the provisions of Section 83(1) of the Act;
c) Issue a Writ ofMandamus or any other Writ, order or direction;
d) to issue appropriate writ, order or direction, directing to release/restore the six bank accounts as stated in prayer (a) for the exclusive operations ofpetitioner for running their day to day business affairs;”
2. The grievance of the petitioner is that the respondents, in pursuance of the search operation which was conducted between 01.11.2019 and 30.11.2019, at various places of the petitioner, under Section 67(2) of the CGST Act, proceeded to issue provisional attachment orders under Section 83 of the CGST Act dated 02.12.2019 and 03.12.2019, which have also been impugned in the present petition. The petitioner states that bank accounts have been attached under Section 83 of the Act, particulars whereof are as follows:-
