Kanal Enterprise v. State of Gujarat
[Citation -2020-LL-0311-66]

Citation 2020-LL-0311-66
Appellant Name Kanal Enterprise
Respondent Name State of Gujarat
Court HIGH COURT OF GUJARAT AT AHMEDABAD
Relevant Act CGST
Date of Order 11/03/2020
Judgment View Judgment
Keyword Tags pendency of proceedings • attachment of property • goods and services tax • provisional attachment • input tax credit


C/SCA/17673/2019 ORDER IN HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 17673 of 2019 M/S KANAL ENTERPRISE Versus STATE OF GUJARAT Appearance: MR. APURVA N MEHTA(7202) for Petitioner(s) No. 1 VIJAY H PATEL(7361) for Petitioner(s) No. 1 MR SOAHAM JOSHI, AGP for Respondent(s) No. 1,2,3 CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA and HONOURABLE MR. JUSTICE BHARGAV D. KARIA Date : 11/03/2020 ORAL ORDER (PER : HONOURABLE MR.JUSTICE J.B.PARDIWALA) 1. By this writ application under Article 226 of Constitution of India, writ applicant, registered partnership firm through one of its partners has prayed for following reliefs : (A) YOUR LORDSHIPS may be pleased to admit and allow this Petition. (B) YOUR LORDSHIPS may kindly be pleased to issue writ of Mandamus or any other appropriate writ, order or direction and thereby be pleased to quash and set aside order of provisional attachment of stock of goods valued at Rs. 1,26,00,000 dated 30.07.2019 passed by Respondent No.2. (C) YOUR LORDSHIPS may kindly be pleased to issue writ of Mandamus or any other appropriate writ, order or direction and thereby be pleased to quash and set aside order of provisional attachment of Page 1 of 5 Downloaded on : Thu Jul 01 10:26:30 IST 2021 C/SCA/17673/2019 ORDER Petitioner's Current account bearing A/c No. 655305600366 maintained with ICICI Bank, Nirmala Convent Road Branch, Rajkot dated 30.07.2019 passed by passed by Respondent No.2. (D) YOUR LORDSHIPS may kindly be pleased issue writ of Mandamus or any other appropriate writ, order or direction and thereby be pleased to quash and set aside action of blocking of input tax credit of Rs. 24,30,850 vide communication dated 20.07.2019 by Respondent No.3. (E) Pending admission, hearing and final disposal of present Petition, Your Lordships may kindly be pleased to issue appropriate writ, order or direction and thereby be pleased to stay operation and implementation of orders of provisional attachment dated 30.07.2019 passed by Respondent No. 2 and action of blockage of input tax credit vide communication dated 20.07.2019 by Respondent No.3. (F) Ex-parte ad interim relief in terms of para 9 (E) may kindly be granted; (G) Such other and further reliefs as may be deemed fit in facts and circumstances of case may kindly be granted. 2. co-ordinate bench of this Court while issuing notice, passed following order dated 10.10.2019: 1. Mr. Tushar Hemani, Senior Advocate, learned counsel with Mr. Apurva Mehta and Mr. Vijay Patel, learned advocates for petitioner submitted that in this case, respondents have blocked tax credit of petitioner vide order dated 20.07.2019. It was submitted that there is no provision under State Goods and Services Tax Act or Central Goods and Services Tax Act which empowers respondent officers to block input tax credit of supplier. Page 2 of 5 Downloaded on : Thu Jul 01 10:26:30 IST 2021 C/SCA/17673/2019 ORDER 2. Referring to order dated 30.07.2019 of provisional attachment of property under section 83 of CGST Act as well as order of provisional attachment of stock of petitioner, it was submitted that same have been passed in relation to proceedings launched under section 71(1) of said Acts. Referring to provisions of section 83 of CGST Act, it was pointed out that same can be invoked during pendency of proceedings under sections 62, 63, 64, 67, 73 or 74 of said Act, however, there is no power vested in respondents to invoke provisions of section 83 in proceedings launched under section 71(1) of said Act. It was submitted that, therefore, provisional attachment of bank account as well as stock of petitioner is without authority of law. 3. It was pointed out that subsequently, assessment order has been framed on 16.09.2019, to submit that once assessment is framed, attachment under section 83 of CGST Act would no longer survive. 4. Having regard to submissions advanced by learned counsel for petitioner, issue Notice, returnable on 17th October 2019. By way of ad-interim relief, respondents are directed to forthwith release attachment of bank account of petitioner bearing No. 655305600366 maintained with ICICI Bank, Rajkot made vide order dated 20.07.2019 and unblock credit of petitioner of Rs.24,30,850/- available in electronic credit ledger. 4.1 Direct service is permitted. 3. learned counsel appearing for writ applicant pointed out that by virtue of ad- interim relief granted, attachment of Bank account came to be lifted. Page 3 of 5 Downloaded on : Thu Jul 01 10:26:30 IST 2021 C/SCA/17673/2019 ORDER 4. However, according to him, attachment over goods continued to operate by virtue of impugned order passed under Section 83 of Act. 5. short point falling for our consideration is whether impugned order of attachment of property under Section 83 of Act could have been passed on ground of proceedings instituted under Section 71(1) of Act. plain reading of Section 83 of Act would indicate that powers can be invoked during pendency of proceedings under Sections 62, 63, 64, 67, 73 and 74 of Act. There is no power vested in authorities to invoke provisions of Section 83 during pendency of proceedings instituted under Section 71(1) of Act. 6. In fact, there cannot be any proceedings, which could be instituted under Section 71 of Act. Section 71 of Act talks about access to business premises. 7. In such circumstances, impugned order of attachment under Section 83 of Act is hereby quashed and set aside. Page 4 of 5 Downloaded on : Thu Jul 01 10:26:30 IST 2021 C/SCA/17673/2019 ORDER 8. It is needless to clarify that Appeal preferred by writ-applicant against final order of assessment shall be decided in accordance with law by Appellate Authority. 9. With above, this writ application stands disposed of. Direct service is permitted. (J. B. PARDIWALA, J) (BHARGAV D. KARIA, J) KUMAR ALOK Page 5 of 5 Downloaded on : Thu Jul 01 10:26:30 IST 2021 Kanal Enterprise v. State of Gujarat
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