Case Law Details
Greenfinch Team Management P. Ltd Vs Union of India (Telangana High Court)
Attachment of bank account of a taxable person is a serious measure which has the effect of not only adversely affecting property rights of such person but is also an intrusion into his privacy. The power being drastic, it has to be exercised by a high authority like the Commissioner. However, the condition precedent for exercise of such power is that proceedings under Sections 62, 63, 64, 67, 73 or 74 should be pending against the taxable person. Further, the Commissioner must also form an opinion that to protect the interest of government revenue, it is necessary to provisionally attach any property of the taxable person including the bank account. If these two conditions are fulfilled, Commissioner may pass an order provisionally attaching any property of the taxable person including bank account by making an order in writing. However, being a coercive provision legislature has ensured that duration of provisional attachment does not exceed a period of one year.
By its very nature, provisional attachment cannot be for an indefinite period. Dictionary meaning of provisional is ‘arranged or existing for the present, possible to be changed later’; Black’s Law Dictionary, eighth edition, has defined it as ‘temporary’ or ‘conditional’. The two words ‘provisional’ and ‘attachment’ read in conjunction can only mean a ‘temporary attachment’.
Therefore, to ensure that the valuable right of a taxable person is not infringed for an indefinite period, legislature itself has provided for a definite time line in sub-section (2) of Section 83 of the CGST Act mandating that a provisional attachment order would have a life span of only one year from the date of the order made under sub-section (1). After expiry of a period of one year, such provisional attachment would cease to have effect.
Having regard to the legislative mandate, it is evident that both the provisional attachment orders dated 02.12.2019 and 08.12.2021 have spent their force. Such provisiona attachment orders cannot therefore be allowed to continue beyond the period prescribed under the statute.
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