Page 96 - GSTL_14th May 2020_Vol 36_Part 2

198 GST LAW TIMES [ Vol. 36
(2) The Commissioner shall send a copy of the order of attachment to the
concerned Revenue Authority or Transport Authority or any such Authori-
ty to place encumbrance on the said movable or immovable property,
which shall be removed only on the written instructions from the Commis-
sioner to that effect.
(3) Where the property attached is of perishable or hazardous nature, and
if the taxable person pays an amount equivalent to the market price of such
property or the amount that is or may become payable by the taxable per-
son, whichever is lower, then such property shall be released forthwith, by
an order in FORM GST DRC-23, on proof of payment.
(4) Where the taxable person fails to pay the amount referred to in sub-
rule (3) in respect of the said property of perishable or hazardous nature,
the Commissioner may dispose of such property and the amount realized
thereby shall be adjusted against the tax, interest, penalty, fee or any other
amount payable by the taxable person.
(5) Any person whose property is attached may, within seven days of the
attachment under sub-rule (1), file an objection to the effect that the proper-
ty attached was or is not liable to attachment, and the Commissioner may,
after affording an opportunity of being heard to the person filing the objec-
tion, release the said property by an order in FORM GST DRC-23.
(6) The Commissioner may, upon being satisfied that the property was, or
is no longer liable for attachment, release such property by issuing an order
in FORM GST DRC-23.”
23. At this juncture, it is important to examine the relevant judgments
to adjudicate the legal issue at hand. In the judgment cited by the petitioner in
Valerius Industries (supra), the Gujarat High Court held that initiation of proceed-
ings under Section 67 of the CGST Act, 2017 by itself is not sufficient to provi-
sionally attach the property for the purpose of protecting the interest of the gov-
ernment revenue. The relevant extract of the judgment is delineated below :
“52. Our final conclusions may be summarized as under :
(1) The order of provisional attachment before the assessment order is
made, may be justified if the assessing authority or any other authority em-
powered in law is of the opinion that it is necessary to protect the interest of
revenue. However, the subjective satisfaction should be based on some
credible materials or information and also should be supported by super-
vening factor. It is not any and every material, howsoever vague and indef-
inite or distant remote or farfetching, which would warrant the formation
of the belief.
(2) The power conferred upon the authority under Section 83 of the Act
for provisional attachment could be termed as a very drastic and far-
reaching power. Such power should be used sparingly and only on sub-
stantive weighty grounds and reasons.
(3) The power of provisional attachment under Section 83 of the Act
should be exercised by the authority only if there is a reasonable apprehen-
sion that the assessee may default the ultimate collection of the demand
that is likely to be raised on completion of the assessment. It should, there-
fore, be exercised with extreme care and caution.
(4) The power under Section 83 of the Act for provisional attachment
should be exercised only if there is sufficient material on record to justify
the satisfaction that the assessee is about to dispose of wholly or any part of
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