Gujarat High Court Quashed & set aside the provisional attachment order qua the stock of Goods, Demat Account & Current Account

Facts:

• Appellant is engaged in manufacture and sale of ingots (a solid piece of metal, especially gold or silver, usually shaped like a brick).
• Department has launched the proceedings against the applicant on the suspicion that applicant had shown purchases from fictitious firms.
• Pursuant to such search, the GST authority had passed an order of provisional attachment of various properties of the applicant including the electronic items like mobile phone, laptop etc.

Points Considered for Judgment:

• GST authority has not only provisionally attached the stock of goods lying at the factory premise of the applicant, but at the same time, has also provisionally attached the demat account and current account of the applicant.
• The applicant has also made represent followed by subsequent reminders, but the same are not responded. As department has provisionally attached current account and other important documents which are valuable assets necessary for running of the business.
• Thus, action of provisional attachment should not hamper normal business activities.
• Impugned order of provisional attachment is quashed and set aside by the High Court as the court relied on the earlier judgment in the case of M/s. Utkarsh Ispat LLP vs. State of Gujarat 2022.

Judgement:

The order of the provisional attachment qua the stock of goods, two demat accounts as well as current account of the writ applicant is quashed. Further, electronic items including mobile phone, laptop and other documents seized during the search proceedings are also to be released.

Hrithik Sachdeva, Audit Associate, SW India