Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *   CBIC issues draft rules for Customs valuation *  Top Headlines: Threshold for Benami deals, green bond investors, and more *  Govt aims 1-hour clearance for goods at all ports *  Exporters Allowed To Use RoDTEP, RoSCTL Scrips To Pay Customs Duty, Transfer Them; Rules Amended *  Millions of labourers to be affected by brick producers’ strike over hike in GST, coal rates *  Inauguration of ‘kendriya GST parisar’ *  Transporter can seek Release of Conveyance alone, not Goods under GST Act: Madras HC *  GST: Quoting of DIN Mandatory for Responding to Notice, Govt Modifies Portal *  Firms can soon file claims for GST credits of ?400 cr *  CBIC issues modalities for filing transitional credit under GST. *  Mumbai: Man creates 36 fake GST firms, arrested for input tax credit fraud of Rs 23 cr *  Report to restructure Commerce Ministry under study; idea is to set up trade promotion body: Goyal *  Firms can soon file claims for GST credits of ?400 cr *  Gambling Alert! Govt May Levy Up To 28% GST; UP, Bengal Back Move *  EPFO backs raising retirement age to ease pressure on pension funds *  India Moving Up Power Scale, Set to Become Third Largest Economy By 2030 *  Airfares Get Expensive: What Changes for Flyers From Today? *  IRCTC Latest News: Passengers to Pay More For Cancelling Confirmed Rail Tickets Soon. *  IBC prevails over Customs Act, says Supreme Court. *  As GST enters sixth year, a time for evaluation and reassessment *  There’s GST on daily essentials as Centre needs money to buy MLAs: Arvind Kejriwal *  Now, GST on cancellation of confirmed train tickets, hotel bookings *  GST kitty for top States could rise 20% in FY23, says Crisil *  French customs officials seize another cargo vessel over Russia sanctions *  TradeLens builds on Asia momentum with Pakistan Customs deal *  Hike tax on tobacco, reduce affordability & increase revenue: Civil society organizations to GST council *  Bihar: ?10 crore tax evasion on tobacco products detected in raids *  Centre failed on GST, COVID; would it be anti-national? Rajan on Infosys row *  Service Tax not Chargeable on Income Tax TDS portion paid by recipient: CESTAT grants relief to TVS *  Foreign portfolio investors make net investment of Rs 7575cr in Sep so far
Subject News *  Run-up to Budget: Monetary threshold for GST offences may rise to Rs 25 cr *   GST (Tax) E-invoice Must For Businesses With Over Rs 5 Crore Annual Turnover *   Both Central GST and excise duty can be imposed on tobacco, rules Karnataka high court *   CBIC Issues Clarification On Extended Timelines For GST Compliance *   CBIC Issues Clarification On Extended Timelines For GST Compliance *  Budget 2023- 9.6 crore gas connections *  GST: Tamil Nadu Issues Instructions for Assessment and Adjudication Proceedings *  GST: CBIC Extends Last Date for filing of ITC *  GST collection in September surpasses Rs 1.4 lakh crore for straight seventh time *  Dollar smuggling case: Customs chargesheet names M Sivasankar as key conspirator. *  Hike in GST rates fuels inflation *  Assam: CBI arrests GST commissioner in Guwahati *  GST fraud worth ?824cr by 15 insurance Cos detected *  India proposes 15% customs duties on 22 items imported from UK *  Decriminalising certain offences under GST on cards *  Surge in GST collections more due to higher inflation: India Ratings *  MNRE Notifies BCD and Hike in GST Rates as ‘Change in Law’ Events But With a Condition | Mercom India *   Solar projects awarded before customs duty change allowed cost pass-through *  Rajasthan High Court Dismisses Writ Petitions Challenging Levy Of GST On Royalty *   GST revenue in September likely at Rs 1.45 lakh crore *  Govt working on decriminalising certain offences under GST, lower compounding charge *  Building an institution like GST Council takes time, trashing is easy: Sitharaman *  GST collections in Sept may touch ?1.5 lakh crore *  KTR asks Centre to withdraw GST on handlooms *  After Gameskraft, More Online Gaming Startups To Receive GST Tax Claims *  Madras HC: AAR Application Filed Under VAT Does Not Survive After GST Enactment *  Threshold for criminal offences under GST law may be raised *  Bengaluru: Gaming company faces biggest GST notice of Rs 21,000 crore *  CBIC clarifies Classification of Cranes for GST, Customs Duty *  Customs seize gold hidden in bicycle in Kerala airport  

Comments

Print   |    |  Comment

GST Update on Attachment of bank account by GST Authorities- Important Judgments 104/2020-21

GST Update on Attachment of bank account by GST Authorities- Important Judgments 104/2020-21
A writ petition can be filed by any citizen of India with a State High Court or Supreme Court in case their fundamental rights are affected or violated by the actions of any state or government authority or body. The court issues a writ in the form of formal written order, warrant or direction to such authority or body to implement the correct remedy and rectify such violation of fundamental rights. 
A writ petition can be filed under Article 226 with a High Court and Article 32 with the Supreme Court. The process is mostly the same for filing a writ in the High court or Supreme Court, with certain exceptions as the jurisdiction of the High Court is wider and extends to constitutional rights as well.
Since the implementation of GST, we have seen that numerous writ applications are being filed by taxpayers for relaxation in case of transitional credit, last date of availment of credit in GSTR 3B, e way bill, interim bail relief etc. Some of the landmark judgments includes Safari Retreats, AAP and Co., Bharti Airtel, Brand Equities, Sutherland Global Services Private Limited and the list goes on. High Court has proved to be “Sankat Mochan” and last resort solution in the era of GST regime for aggrieved taxpayers. This update is penned down to discuss decisions passed by High Court in relation to bank account attachment. 
Recently, High Court of Madras in case of Shree M. Revathi Printers vs Dy. Commissioner vide W.P.No.7811 of 2020 has directed department to defreeze Bank A/c of Taxpayer considering the Covid-19 situation and allow taxpayer to settle dues within 6-month time.
The writ petition is filed challenging the proceedings of the first respondent dated 28.02.2020, attaching the bank account of the petitioner maintained in the  second respondent Bank for realizing the tax dues amounting to a sum of Rs.83,58,962/-. It is stated that after making attachment, the first respondent has deducted a sum of Rs.12,45,662/- from the bank account of the petitioner maintained in the second respondent Bank.
The grievance of the petitioner is that in view of the present lock down situation due to COVID-2019, the petitioner is not in a position to run the business and therefore, they are not in a position to settle the dues immediately. The petitioner submitted that the petitioner will pay the entire dues, if 6 months’ time is granted. He said that he is not denying in making the payment rather want time extension in clearing the dues. He has also submitted that since the bank account is attached, the petitioner is not in a position to run the day-to-day life even to pay salary to the employees. After considering all the submissions, the Court allowed the petition. 
It is worthwhile to mention some of the few judgments passed by High Court in favor of taxpayers- 
M/s RCI Industries & Technologies Ltd. Vs. Directorate General of GST Intelligence, Gurugram and Another (Punjab & Haryana High Court)- Hon’ble High Court dispose of this petition with a direction that the attachment would be limited to the amounts which were lying to the credit of the petitioner in CC A/c, at the time of freezing and any further credit which may come would not be under attachment.
Karnataka High Court in the case of M/s LC Infra Projects P Ltd- WRIT APPEAL NO.188 OF 2020 (T-RES)- Issuance of a show Cause Notice is sine qua non to proceed with the recovery of interest payable under Section 50 of the GST Act and penalty leviable under the provisions of the GST Act and the Rules. Order of Bank attachment is set aside.
Gujarat High Court in the case of M/s Alfa Enterprise V State of Gujarat- Special Civil Application No 16698 of 2019- The order of attachment of bank account is prima facie without authority of law and the order of blocking of electronic credit ledger by making a computer entry; is not backed by any statutory provision; is not backed by any provision of law which empower the authorities to block the credit.
Bombay High Court in the case of Petition filed by Gehna Trading LLP – 95-HC-BOM-GST-2020- Provisional attachment power is not a universal power given to the department and it has to be used in certain special situations. The court stated and assumed that the section 62, 63, 64, 67, 73 and 74 mentioned in section 83 of the Act are not applicable to the petitioner but issued summon as per the pursuant to the inquiry adding the M/s. Maps Global under section 67 of the Act, as per the summon. Therefore, the judges said that the attachment powers might come to rescue the government revenue but are still not acceptable to apply them to any situation without properly understanding them.
 
Businesses living under the threat of bank accounts being attached during a pending goods and services tax inquiry can breathe easy taking the shield of above-mentioned judgments. 
We hope that the government makes stricter rules and regulations in regard to bank attachment proceedings so that the assessee doesn’t take the route of High Court and it is settled at the grassroot level only. But at the same time, Government should also not take the extreme step of freezing of bank account in this COVID-19 situation. The harsh action of freezing bank account will mean closure of business of taxpayers. Everyone is suffering from financial crisis in this difficult situation. Businessman is trying hard to come out of this crisis but the extreme step of seizure of bank account will prove fatal for him. Nobody is going to gain from the same.
This is solely for educational purpose.
You can reach us at www.capradeepjain.com , at our facebook page on https://www.facebook.com/GSTTODAYBYPRADEEPJAIN/ as well as follow us on twitter at https://www.twitter.com/@capradeepjain21 and u may also follow us on Linkedin https://www.linkedin.com/in/ca-pradeep-jain-b6a31a16 
Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com