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2020 (9) TMI 677 - HC - GSTProvisional attachment of Bank Accounts of petitioner - It is the case of the petitioners that the bank accounts of the petitioners have been provisionally attached under section 83 of the Gujarat GST Act, without considering the provisions of section 83 of the GGST Act, as in the case of the petitioners no proceedings are pending under any of the sections mentioned therein - HELD THAT:- The petitioners have issued very large number of E-Way bills within a short period of time between their associate concern without movement of goods like cement, iron, tiles, brass etc. From the report, submitted to the Enforcement department of the respondent authorities, it is also revealed that the petitioners were involved in carrying out the transactions on paper without actual physical movement of goods. It is also pertinent to note that petitioner no.2 has shown total ignorance with regard to the transactions which were reported to be fictitious, more particularly, when the petitioner no.2 is the owner of the petitioner no.1 firm. Exercise of powers under section 83 of the GGST Act for provisional attachment by the respondent authorities - HELD THAT:- This Court in case of VALERIUS INDUSTRIES VERSUS UNION OF INDIA [2019 (9) TMI 618 - GUJARAT HIGH COURT] has given guidelines for invoking the powers under section 83 of the GGST Act which states that authority before exercising power under Section 83 of the Act for provisional attachment should take into consideration two things: (i) whether it is a revenue neutral situation (ii) the statement of “output liability or input credit”. Having regard to the amount paid by reversing the input tax credit if the interest of the revenue is sufficiently secured, then the authority may not be justified in invoking its power under Section 83 of the Act for the purpose of provisional attachment. Prima facie, there is reasonable apprehension that the petitioners may default in the ultimate collection of the demand that is likely to be raised on completion of the assessment. It appears that prima facie there is sufficient material on record to justify the satisfaction in view of denial of the petitioner no. 2 with regard to the transactions carried out by the petitioner no.1 which is a proprietary concern of petitioner no.2. It also emerges from the materials on record that this is a fit case to invoke the provisions of section 83 of the GGST Act as apparently the petitioners seem to have been indulging in bogus billing causing loss to the Revenue and as such it cannot be said that passing of the impugned order under section 83 of the GGST Act is for recovery of dues but it is only for the purpose of protecting the Government revenue as the petitioner has failed to produce on record to show as to the capacity to pay the tax dues which may be levied upon the petitioners on completion of the assessment proceedings - it cannot be said that the respondent authorities have no reason to form an opinion as required by section 83 of the GGST Act for passing the impugned order of provisional attachment. Thus, once an opinion is formed by the competent authority as stipulated in section 83 that there is a reasonable apprehension that the petitioners may default in ultimate collection of demand that is likely to be raised on completion of the assessment, then it was incumbent upon the respondent authorities to exercise powers under section 83 of the GGST Act - no interference is required to be made in exercise of powers under section 83 of the GGST Act by the respondent authorities while exercising extraordinary powers under Articles 226 and 227 of the Constitution of India. Petition dismissed.
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