RR India Pvt. Ltd. v. Union of India & Ors
[Citation -2020-LL-0217-81]

Citation 2020-LL-0217-81
Appellant Name RR India Pvt. Ltd.
Respondent Name Union of India & Ors.
Court HIGH COURT OF DELHI AT NEW DELHI
Relevant Act CGST
Date of Order 17/02/2020
Judgment View Judgment
Keyword Tags opportunity of being heard • provisional attachment • filing of objections • search operation • grants


$ 44 * IN HIGH COURT OF DEL HI AT NEW DELHI + W.P.(C) 1597/2020 RR INDIA PVT. LTD ..... Petitioner Through: Mr. Rajesh Jain, Mr.Virag Tiwari, Mr.Ramashish and Mr.K.J.Bhat, Advocates versus UNION OF INDIA & ORS. ..... Respondents Through: Mr.Satish Aggarwala, Sr.Standing Counsel with Mr.Vineet Sharma, Advocate for R-1 and R-2 Mr.Sanjeev Sagar, Advocate/Standing Counsel for UBI and Ms.Nazia Parveen, Advocate for R-3 Mr.Aman Leekha and Mr.Udbhav Kumar Jain, Advocates for R-5/HDFC Bank Mr.Avnish Singh, Sr.Panel Counsel for UOI CORAM: HON'BLE MR. JUSTICE VIPIN SANGHI HON'BLE MR. JUSTICE SANJEEV NARULA ORDER % 17.02.2020 1. petitioner has preferred present writ petition to seek following reliefs:- a) quash and set aside impugned orders dated 6.2.2020, 2.12.2019 & 3.12.2019; b) declare Rule 159(5) of Rules to extent it specifies time period of seven days as ultra-vires of provisions of Section 83(1) of Act; W.P.(C) 1597/2020 Page 1 of 6 c) Issue Writ of Mandamus or any other Writ, order or direction; d) to issue appropriate writ, order or direction, directing to release/restore six bank accounts as stated in prayer (a) for exclusive operations of petitioner for running their day to day business affairs; 2. grievance of petitioner is that respondents, in pursuance of search operation which was conducted between 01.11.2019 and 30.11.2019, at various places of petitioner, under Section 67(2) of CGST Act, proceeded to issue provisional attachment orders under Section 83 of CGST Act dated 02.12.2019 and 03.12.2019, which have also been impugned in present petition. petitioner states that bank accounts have been attached under Section 83 of Act, particulars whereof are as follows:- S. Order C.No. Balance Account Number Bank Cr. Balance No. as on 1 267/INT/DGGI/H 31.12.19 378501010034789 Union 4.94,76,201.30 Q/2019/8499 Bank of India 2 267/INT/DGGI/H 11.2.20 5020008548874 HDFC 86,51,284.80 Q/2019/8500 Bank 3 267/INT/DGGI/H 11.2.20 510341000669579 Corpor 2,90,533.84 Q/2019/8501 Given new number ation Bank 267/INT/DGGI/H i.e. Q/2019/8557 164701601000104 4 267/INT/DGGI/H 11.2.20 135405001069 ICICI 1,46,03,591.98 Q/2019/8502 Bank 5 267/INT/DGGI/H 28.1.20 034305003448 ICICI 1,34,178.44 Q/2019/8558 Bank Total 7,31,55,790.36 3. petitioner filed objections to original attachment, which have W.P.(C) 1597/2020 Page 2 of 6 been rejected vide order No .01/2020 dated 06.02.2020, only on ground that petitioner had not moved under Rule 159(5) of CGST Rules within period of 7 days of attachment. Rule 159(5) reads as follows:- 159(5) Any person whose property is attached may, within seven days of attachment under sub-rule (1), file objection to effect that property attached was or is not liable to attachment, and Commissioner may, after affording opportunity of being heard to person filing objection, release said property by order in FORM GST DRC-23. 4. submission of learned counsel for petitioner is that before respondents, petitioner relied upon decision of Supreme Court in Sambha Ji Vs. Gangabai, 2009 (240) ELT 161 (SC). In said case, Court construed Order 8 Rule 1 CPC to be directory provision, notwithstanding that it requires defendant to present written statement of his defence within 30 days from date of service of summons upon him. Order 8 Rule 1 CPC reads as follows: - 1. Written statement defendant shall, within thirty days from date of service of summons on him, present written statement of his defence. Provided that where defendant fails to file written statement within said period of thirty days, he shall be allowed to file same on such other day, as may be specified by court, for reasons to be recorded in writing, but which shall not be later than ninety days from day of service of summons. 5. aforesaid would show that proviso grants additional period of 60 days from date of service of summons, while also employing words but which shall not be later than ......... . W.P.(C) 1597/2020 Page 3 of 6 6. His submission is that despite language employed by Parliament in aforesaid provision, Supreme Court held that period for filing of written statement could be extended even beyond period of 90 days from date of service of summons. Paragraph 8 and 13 of said decision reads as under: 8. Order 8 Rule 1 after amendment casts obligation on defendant to file written statement within 30 days from date of service of summons on him and within extended time falling within 90 days. provision does not deal with power of court and also does not specifically take away power of court to take written statement on record though filed beyond time as provided for. Further, nature of provision contained in Order 8 Rule 1 is procedural. It is not part of substantive law. Substituted Order 8 Rule 1 intends to curb mischief of unscrupulous defendants adopting dilatory tactic, delaying disposal of cases, causing inconvenience to plaintiffs and petitioners approaching court for quick relief and also serious inconvenience of court faced with frequent prayers for adjournments. object is to expedite hearing and not to scuttle same. While justice delayed may amount to justice denied, justice hurried may in some cases amount to justice buried. x x x x 13. it is also to be noted that though power of court under proviso appended to Rule 1 of Order 8 is circumscribed by words shall not be later than ninety day but consequences flowing from non-extension of time are not specifically provided for though they may be read by necessary implication. Merely, because provision of law is couched in negative language implying mandatory character, same is not without exceptions. courts, when called upon to interpret nature of W.P.(C) 1597/2020 Page 4 of 6 provision, may, keeping in view entire context in which provision came to be enacted, hold same to be directory though worded in negative form. 7. Learned counsel for petitioner further submits that under CGST Act or Rules, there is no provision which mandates filing of objections to provisional attachment within 7 days. No consequence of delay in filing objections is provided. Moreover, respondent does not suffer any adverse consequence on account of delay on part of objector in moving objections which is beyond period of 7 days of date of provisional attachment. 8. On other hand, Mr. Aggarwala submits that respondents are bound to comply with letter of law and since sub-Rule 5 of Rule 159 stipulates that person whose property is attached, may within 7 days of attachment under sub-Rule (1), file objection, petitioner ought to have filed same within aforesaid stipulated period. Since, admittedly, objections were preferred beyond period of 7 days, respondent were bound to reject same. 9. Having heard both learned counsels, it is clear to us that period of 7 days prescribed in Rule 159(5) is directory and not mandatory period. Therefore, on account of delay on part of objector, if he prefers his objections beyond period of 7 days, objections cannot be rejected on ground of limitation. No consequence is prescribed either in Act or in Rules to say that if objections are not preferred within 7 days, they shall not be entertained. W.P.(C) 1597/2020 Page 5 of 6 10. decision in Sambhaji (supra) is clearly attracted to present case. Moreover, it is objector who would suffer adverse consequence on account of delay on his part in raising objections. respondents do not suffer any adverse consequence on account of delay, if any, in moving objections. We, therefore, hold that period of 7 days prescribed in Rule 159(5) of CGST Rules for moving objections to provisional attachment is merely directory and not mandatory. Objections raised by petitioner, therefore, could not be rejected on that ground alone. 11. We accordingly set aside order No. 1/2020 dated 06.02.2020 and remand proceedings back to concerned authority for passing fresh order on merits of objections. officer concerned shall proceed to pass fresh reasoned order within two weeks from today. 12. Petition stand disposed of in above terms. 13. Order dasti. VIPIN SANGHI, J. SANJEEV NARULA, J. FEBRUARY 17, 2020 mamta W.P.(C) 1597/2020 Page 6 of 6 RR India Pvt. Ltd. v. Union of India & Or
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