Facts of the Case: In this case, the petitioner faced provisional attachment of its bank accounts under Section 83(1) by the Commissioner. The orders of attachment were issued on 13.11.2024 and later renewed on 18.12.2024. The petitioner contended that Section 83(2) clearly limits such attachments to a maximum of one year from the date of the order, and the department had no power to issue successive orders to continue attachment beyond this statutory period.

The Gujarat High Court upheld the attachment orders, leading the petitioner to approach the Supreme Court.

Issue: Whether a fresh order of provisional attachment under Section 83(1) of the CGST Act, 2017 can be passed after the expiry of one year from the date of the original attachment order? Further, whether Section 83(2) of the CGST Act contemplates only a single, time-bound attachment or allows the revenue authorities to repeatedly issue fresh provisional attachment orders in continuation of earlier ones.

Held that: The Supreme Court held that Section 83(2) mandates that every provisional attachment order shall cease after one year from the date of the order. Issuing fresh attachment orders immediately after expiry would render Section 83(2) nugatory and redundant, which cannot be the intent of the legislature.

Reliance placed upon on Sant Ram Sharma v. State of Rajasthan (1967), wherein Court reiterated that executive power can only supplement, not supplant, statutory provisions. There is no implied executive authority to re-attach property beyond the statutory one-year cap. Thus, in absence of legislative authority, the executive could not assume an implied power to re-attach property beyond the one-year limit prescribed by Parliament under Section 83(2).

Further, the Court held that provisional attachment is a serious invasion of taxpayer rights, and must be construed strictly. Successive re-attachments would lead to indefinite freezing of accounts, which is impermissible.

Though the appellant also raised a jurisdictional challenge to the officers issuing the order, the Court held the attachment orders invalid on substantive grounds and thus did not go further on jurisdiction.

The impugned provisional attachment orders dated 13.11.2024 and 18.12.2024 were declared illegal and unsustainable. The revenue authorities were directed to defreeze the petitioner’s bank accounts forthwith. The appeal was allowed in favour of the assessee

Case Name: KESARI NANDAN MOBILE Versus OFFICE OF ASSISTANT COMMISSIONER OF STATE TAX (2), ENFORCEMENT DIVISION – 5

To read the complete judgment 2025 Taxo.online 1887