2023 (6) TMI 943 - HC - GST

Seeking information from the Advocates relating to their clients - Evasion of GST - Maintainability of appeal - several fake companies who have illegally committed GST fraud have been unearthed and criminal proceedings and other proceedings have been initiated - HELD THAT - The appeal is maintainable for the reason that soon after the impugned order was passed by the learned Single Bench the Anti Fraud Department of the Kolkata Police as well as the GST Department had issued a series of notice to all the learned advocates who are regularly appearing for their clients in cases pertaining to GST/WBVAT/WBST Acts and other related enactments. When this matter is brought to the notice of this Court the authorities of the respondent were well advised that they had no jurisdiction to issue notices to the learned advocates calling for information regarding their clients as the information given by the clients is a privileged communication given to an advocate. It is a settled legal position that a communication is privileged if it is made to a legal advisor by a client after the commission of a crime and with a view to his defence but it is not privileged if it is made before the commission of the crime or wrong and for the purpose of being guided or assisted in furthering or committing it. Thus Section 126 of the Evidence Act is designed to abort the attempt to intrude privacy of the close preserve of the fund of information conveyed by the client closeted in confidence. In Bakaulla Mollah v. Debiruddin Mollah 1912 (4) TMI 4 - CALCUTTA HIGH COURT it is held that Section 126 of the Evidence Act prohibits an attorney from disclosing an attorney-client communication without the expression concerned of the client. This appeal is maintainable. Whether the order and direction issued by the learned Single Bench has been properly understood or misconstrued by the authorities of the Anti Fraud Department? - HELD THAT - The observation issued by the court has to be understood within the four corners of law. The police authorities have been directed to investigate and the observation of the court is to investigate about filing of fake cases. Unfortunately the authorities of the Anti Fraud Department have misconstrued and misunderstood the scope of the direction which is clear from the notice issued under Section 160 Cr.P.C. to the Directors of various assessees - the notices issued under Section 160 Cr.P.C. which are standardize forms are set aside and we give liberty to the Police Department as well as the GST Department to conduct a proper investigation qua the assessees and not to generalize and grant all assessees throughout the State of West Bengal to be fraudsters this approach is not in accordance with law. Appeal disposed off.

Summary

Issues Involved:
1. Leave to prefer appeal against an order dated 3rd April, 2023.
2. Condonation of delay of 32 days in filing an appeal.
3. Maintainability of an intra-court appeal by a third party against an order passed by a Single Bench.

Summary:
Issue 1:
The applicant sought leave to prefer an appeal against the order dated 3rd April, 2023, which disposed of the writ petition. The applicant, not a party to the writ application, claimed that the order seriously affected him. After hearing both parties, the court granted leave to the applicant to prefer the appeal against the said order, allowing the application.

Issue 2:
An appeal was filed seeking condonation of a 32-day delay in filing. The appellant's counsel provided an explanation for the delay, which the court found sufficiently justified. The court allowed the appeal, condoning the delay in filing.

Issue 3:
The third-party appeal was against an order passed by a Single Bench, challenged by the State counsel on grounds of maintainability. The court considered the maintainability of the appeal and found it valid, citing legal provisions protecting lawyer-client communications. The court clarified the order's scope, directing proper investigation methods and setting aside standardized notices issued by authorities. It emphasized that GST authorities should conduct thorough investigations before initiating proceedings under the GST Act, ensuring compliance with the law. With these directions, the appeal was disposed of.

This judgment addressed the issues of seeking leave for appeal, condoning a delay in filing, and the maintainability of an intra-court appeal by a third party, ensuring legal procedures were followed and rights were protected.