Case Details:
| Particular | Details |
| Case No. | W.P.(C) NO. 17547 OF 2022 |
| Case Name | Sidhivinayak Chemtech (P.) Ltd. v. Principal Commissioner, CGST |
| Court | High Court of Delhi |
| Date of Judgement | 16-05-2023 |
| Citation | GIG-CLS-0001 |
Issue- In the above case, the petitioner company having registered office at Delhi was engaged in the trade of industrial chemicals relating to the pesticide industry. Petitioner was registered in two states one is Haryana and another is Uttar Pradesh. Petitioner’s bank account was attached by Principal Commissioner of Meerut alleging that the petitioner company had fraudulently transferred ITC amounting to ₹36.6 crore to two companies, without supplying any goods to the said companies. The questions challenged by petitioner were:-
- Whether Principal Commissioner of Meerut has jurisdiction to pass attachment order where principal place of business of petitioner was located in Haryana and Uttar Pradesh?
Held- It was held that opening sentence of Section 122(1) of the CGST Act also refers to a taxable person. Thus, the assets of a person falling under Sub-section (1A) of Section 122 of the CGST Act can be attached only by a Commissioner who exercises jurisdiction in respect of the said taxable person. Accordingly, it was conceded that Principal Commissioner did not exercise jurisdiction in respect of territories where the petitioner’s principal place of business is located and thus, he had no jurisdiction to pass the attachment order in respect of the petitioner as ‘the taxable person’.
- Whether provisional attachment order can be passed in each case?
Held- It was held that one of the principal conditions necessary required for provisionally attaching a property (including a bank account) under Section 83 of the CGST Act is formation of an opinion by the Commissioner that such attachment is necessary for protecting the interest of the Government and the Revenue. Formation of the opinion cannot be a mere subjective satisfaction of the Commissioner empowered to take measures under Section 83 of the CGST Act but must necessarily be an opinion, which is formed on credible material having live link with formation of the opinion. Since it is draconian in nature and the conditions which are prescribed by the statute for a valid exercise of the power must be strictly fulfilled.
