Smt. Lalita vs Union Of India And Another
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Allahabad High Court

Smt. Lalita vs Union Of India And Another on 25 August, 2025

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 


?Neutral Citation No. - 2025:AHC:146961-DB
 

 
AFR
 
HIGH COURT OF JUDICATURE AT ALLAHABAD
 
WRIT TAX No. - 4082 of 2025
 
Court No. - 3
 
HON'BLE SHEKHAR B. SARAF, J.

HON'BLE PRAVEEN KUMAR GIRI, J.

(Dictated in open Court by Shekhar B. Saraf, J. )

1. Heard Sri Nishant Mishra, learned counsel appearing on behalf of the petitioner, Sri Saumitra Singh, learned counsel appearing on behalf of the respondent No.1 and Sri Ramesh Chandra Shukla, learned counsel appearing on behalf of the respondent No.2.

2. This is a writ petition under Article 226 of the Constitution of India wherein the writ petitioner has sought for the following substantial relief:

"A-Issue a writ, order or direction in the nature of certiorari quashing the impugned order dated 01.05.2025 (Annexure-1) passed by respondent no. 2, to the extent the same relates to the petitioner, attaching the bank account no. 325401001796 of the petitioner maintained with the ICICI Bank, Ghaziabad-201016 for the fourth consecutive year;

B-Issue a writ, order or direction in the nature of mandamus, directing the respondents to forthwith allow the operation of bank account bearing No. 325401001796, Account holder Name- Lalita, ICICI Bank situated at 4, Part A, Gaur Global Village, Crossing Republic, Ghaziabad-201 009;"

3. In the present case, the provisional attachment under Section 83 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the "Act") has been made for the 4th time.

4. Counsel appearing on behalf of the petitioner relies on the very recent judgment of the Supreme Court in Kesari Nandan Mobile v. Office of Assistant Commissioner of State Tax; (2025) 33 Centax 224 (S.C.) to submit that the issue with regard to provisional attachment has been positively answered by the Supreme Court and the law is no longer res integra.

5. Upon perusal of the judgment in Kesari Nandan Mobile (supra), it is clear that the issue therein was with regard to issue of second provisional attachment under Section 83 of the Act. The question of law framed in paragraph 14 of the said judgment is delineated below:

"14. The question of law arising for decision in this appeal is: whether the CGST Act or any other law in force permits issuance of a second provisional attachment order under sub-section (1) of Section 83 of the CGST Act after the initial provisional attachment order issued thereunder ceases, by reason of efflux of a year from the date of its issuance, in terms of sub-section (2) thereof?"

6. Upon examination of a catena of judgments, Dipankar Datta, J. has eloquently penned the judgment of the Supreme Court and held as follows:

"29. Not to speak of a statutory conferment of power, there is a complete absence of any executive instruction consistent with the legislative policy and intendment of the CGST Act authorizing renewal of a lapsed provisional attachment order. Viewed from either angle, issuance of the provisional attachment orders by the respondent under challenge before the Gujarat High Court appears to be indefensible as rightly contended by Mr. Dave.

30. That apart, having regard to the draconian nature of power conferred on the revenue by sub-section (1) of Section 83 of the CGST Act to levy a provisional attachment, the terms of the entire section have to be construed in a manner so that sub-section (2) of Section 83 is not effectively reduced to a dead letter. We are reminded of the maxim utres magis valeat quam pereat. It is an interpretive doctrine that a legal text, specially a statute, should be interpreted in a way that gives the document force rather than makes it fail. Conceding power to the revenue to issue a fresh provisional order of attachment after the initial order has lapsed by operation of law or to renew the same would render the text of sub-section (2) of Section 83 otiose and accepting the reason assigned by the Gujarat High Court would permit the revenue to exercise a power which is not the statutory intendment. We, therefore, see no reason to read Section 83 in a manner to confer any additional power over and above the draconian power conferred by sub-section (1) and upon lapse as ordained by sub-section (2).

31. Moving further, fresh issuance of a provisional attachment order premised on substantially the same grounds as the earlier one would be in disregard to the safeguard provided in sub-section (2). The age- old principle, that an act which cannot be done directly cannot be done indirectly, would apply in its entirety. To permit any other interpretation would result in an abuse of law and due process. If we were to accept the reason assigned by the Gujarat High Court in the impugned order that the law does not place any embargo, it would stand to reason that the authority - not stopping after the 1st renewal order ceases to have effect in terms of sub-section (2) of Section 83 - might continue to issue repeated renewal orders. Repeated or continuous issuance of a provisional attachment order under the garb of ?renewal? could lead to a serious anomaly. With no change in circumstances, repeated orders in the garb of renewal would be contrary to the plain reading of sub- section (2) and akin to filling old wine in a new bottle.

32. Besides, a reading of the statute in its entirety would reveal that the provisional attachment is a pre-emptive measure to protect the interests of government revenue. It cannot function as a recovery measure; for that, the statue has other provisions. Certainly, a period of one year, as ordained by the legislature, is enough for the revenue authorities to conclude its investigation; if not, the legislature could have provided for a renewal or an extended period as in the Excise Act and the Customs Act. Sub-section (2) of Section 83 does not provide for any exception to the rule. Any explanation given by the respondent for issuing a renewal would be in the teeth of the established procedure. Once the inquiry culminates into a final demand, recourse must be had to the provisions under the section which provide for recovery of the assessed tax, penalty, interest, etc. This also provides opportunity to the assessee to challenge the same before the appropriate authority. Short-circuiting the procedure by pursuing a provisional attachment as a means to recover the tax due, as a natural consequence, would frustrate the intent and purpose of the statute."

7. The Supreme Court concluded as follows:

"39. The appellant's argument that the Parliament, being cognizant of other taxing statutes, deliberately chose not to incorporate an extension provision in the section, also carries considerable merit. The procedure of provisional attachment is not alien to tax jurisprudence. Such pre- emptive measure can be found in several statutes, including the Customs Act and the Excise Act, and the Income Tax Act, 1961 as well. Ergo, when the statue does provide for an extension, the authority thereunder is free to do so, subject to such restrictions as may be imposed. Conversely, when a statute does not provide for an extension, renewal, re-issuance, revival ? whatever be the nomenclature ? the executive cannot overreach the statute to do so.

40. Lastly, insofar as the issue of delegation and assumption of jurisdiction as alleged by the appellant in concerned, we have not considered the contention in view of the impugned provisional attachment orders being liable to be set aside on the point of law discussed above.

41. For the foregoing reasons, the question in paragraph 14 is answered in the negative. We hold that the respondent could not have issued the impugned provisional attachment orders dated 13th November, 2024 and 18th December, 2024 upon the previous ones having ceased to have any effect by operation of law after a year of its issuance. The bank accounts attached by the respondent shall stand de-freezed and be made operable forthwith upon production of a copy of this judgment before the banks where the appellant maintains its account."

8. In light of the above ratio laid down by the Supreme Court, no doubt remains with regard to the power of the authorities to impose the provisional attachment time and again. The Supreme Court has clearly held that when the statute does not provide for an extension, renewal, re-issuance, revival, the same cannot be done by the authorities and such an action would amount the executive overreaching the statute.

9. In light of the same, the impugned order dated May 1, 2025 attaching the bank account of the petitioner for the 4th time is quashed and set aside. The authorities are directed to immediately de-freeze the bank account of the petitioner within three days from date.

10. With the aforesaid direction, the writ petition is disposed of.

August 25, 2025

Kuldeep