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A petition was filed, seeking to challenge communication between the bank and the petitioner. The bank had attached the property of the petitioner under Section 83 of the Central Goods and Services Tax Act, 2017.
The learned counsel for the petitioner, Mr. Govind Rishi contended that the bank cannot invoke Section 83 of the Act when the proceedings under Section 71 of the Act are initiated.
The learned counsel for the respondent. Mr. Harpreet Singh submitted that if the proceedings have been initiated under Section 67 of the Act, the circumstances will be justified but it was conceded that the only provision under which an action would be taken was Section 71.
A single-judge bench of Justice Prateek Jalan clarified that as the attachment of a bank account entailed serious consequences to the assessee, the power under Section 83 could only be exercised in strict compliance with statutory power. Therefore, in the absence of any statutory precondition for the exercise of a power of attachment, an order under Section 83 will be illegal.
The court relied on the judgment of Punjab and Haryana High Court and Gujarat High Court, whereas it was held that if any statutory precondition is absent for exercise of a power of attachment, any order under section 83 will be wholly illegal and unsustainable.
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