In a significant development, the GST Policy Wing has introduced a new procedure for the release/restoration of provisionally attached property under section 83 of the CGST Act, 2017. This procedure aims to safeguard the interests of revenue while also ensuring convenience for taxpayers.
Section 83 of the CGST Act, 2017 empowers authorities to issue orders for the provisional attachment of property, including bank accounts, in appropriate cases, to protect the revenue. The procedure for provisional attachment and release/restoration of such property is currently prescribed in rule 159 of the CGST Rules, 2017. To provide further clarity, the GST Policy Wing has issued instructions via CBEC20/16/05/2021-GST on 23rd February 2021.
Under section 83(2) of the CGST Act, 2017, any provisional attachment ceases to have effect after one year from the date of the order made under sub-section (1). However, certain instances have arisen where individuals affected by provisional attachments, especially in cases involving bank accounts, have filed writ petitions requesting that the Commissioner also issue intimation of the release of such attachments. This arises as banks and relevant authorities often require official communication in such matters. These concerns have reached the Hon’ble High Court of Delhi.
After extensive examination and consultation with the policy wing, it has been observed that, in accordance with the legal position outlined in section 83(2) of the Act, read along with rule 159, the property is no longer liable to provisional attachment. Nevertheless, further consultation and actions are necessary to incorporate a prescribed language for the release/restoration of provisionally attached property in a specified form, akin to the GST DRC-23.
As an interim measure, and to ensure taxpayer convenience, the Board has prescribed a procedure to address such situations. As part of this procedure, the Commissioner will issue communication/intimation to the concerned authority/bank, drawing attention to the details of the Order/Form DRC-22 (which initiated the provisional attachment) and the provisions of section 83(2) of the CGST Act, 2017. The communication will explicitly indicate the release/restoration of the relevant property/account in adherence to the aforementioned provisions. Furthermore, a copy of this intimation will be shared with the person concerned. It is essential to emphasize that this procedure will be implemented immediately, including for similar pending cases.
This definitive step taken by the GST Policy Wing and the Board serves to streamline the process of releasing/restoring provisionally attached property under the CGST Act, 2017. taxpayers can expect greater clarity and expediency in their dealings with provisional attachments, thus promoting a more efficient and compliant tax ecosystem.
