Page 97 - GSTL_14th May 2020_Vol 36_Part 2

2020 ] AMAZONITE STEEL PVT. LTD. v. UNION OF INDIA 199
his/her property with a view to thwarting the ultimate collection of de-
mand and in order to achieve the said objective, the attachment should be
of the properties and to that extent, it is required to achieve this objective.
(5) The power under Section 83 of the Act should neither be used as a tool
to harass the assessee nor should it be used in a manner which may have an
irreversible detrimental effect on the business of the assessee.
(6) The attachment of bank account and trading assets should be resorted
to only as a last resort or measure. The provisional attachment under Sec-
tion 83 of the Act should not be equated with the attachment in the course
of the recovery proceedings.
(7) The authority before exercising power under Section 83 of the Act for
provisional attachment should take into consideration two things : (i)
whether it is a revenue neutral situation (ii) the statement of “output liabil-
ity or input credit”. Having regard to the amount paid by reversing the in-
put tax credit if the interest of the revenue is sufficiently secured, then the
authority may not be justified in invoking its power under Section 83 of the
Act for the purpose of provisional attachment.”
24. The Counsel for petitioner has also cited VLS Finance Limited (supra)
wherein the Court has made an observation about not extending the time of pro-
visional attachment after a period of time as prescribed under Section 281B of the
Income-tax Act, 1961. Relevant paragraph of the judgment is presented below :
“9. Sub-section (1) to Section 281B stipulates that an order provisionally
attaching any property of the assessee can be passed during pendency of
any proceedings for assessment/reassessment, if the Assessing Officer is of
the opinion that such an order is necessary for purpose of protecting inter-
est of the Revenue. The order can be only passed with the previous approv-
al of the Chief Commissioner, Commissioner, Director General or Director.
The order has to be in writing. Sub-section (2) to Section 281B states that the
order for provisional attachment under sub-section (1) shall cease to have
effect after six months. Thus, sub-section (2), provides the period during
which an order of provisional attachment remains in force, i.e., six months.
The first proviso to Section 281B states that the Chief Commissioner, Com-
missioner, Director General, Director may for reasons recorded in writing
extend the said period or periods, which shall not exceed two years. Thus,
the total period for which extension can be granted is two years, after the
first order of provisional attachment, which is valid for six months, comes
to an end. The period of provisional attachment, therefore, cannot be for
more than two years and six months. The said period in the present case, as
the first attachment order was issued on 28th July, 2005, came to an end on
24th January, 2008.”
25. Another case presented by the petitioner is Shrimati Majjo (supra)
wherein it was held that the extension of provisional attachment period is not
allowed after a certain period of time as per the provisions of Section 281B of the
Income-tax Act, 1961. Relevant extract of the judgment is delineated below :
“6. We do not, however, think it necessary to examine the said contention
for the reason that the total period for which extensions can be granted un-
der section 281B is two years and that period has also expired on and with
August 19, 1989. It is thus clear that the attachment under section 281B can-
not survive beyond the said date, namely, beyond August 19, 1989. The pe-
titioner shall be entitled to encash or withdraw the amounts concerned sub-
ject, of course, to any demand for any tax due as on today. Even if there is
GST LAW TIMES  14th May 2020  97