Section 83 of GST – Provisional attachment to protect revenue in certain cases
(1) Where during the pendency of any proceedings under section 62 or section 63 or section 64 or section 67 or section 73 or section 74, the Commissioner is of the opinion that for the purpose of protecting the interest of the Government revenue, it is necessary so to do, he may, by order in writing attach provisionally any property, including bank account, belonging to the taxable person in such manner as may be prescribed. (2) Every such provisional attachment shall cease to have effect after the expiry of a period of one year from the date of the order made under sub-section (1).
Analysis of this Section
Introduction –This section confers power to provisionally attach the property of the taxable person in certain situations to protect the interest of the Government. Analysis (i) This section applies only during the pendency of any proceedings under:
(a) Section 62 – Assessment of non-filers of returns.(b) Section 63 – Assessment of unregistered persons.(c) Section 64 – Summary assessment in certain special cases.(d) Section 67 – Power of inspection, search and seizure.(e) Section 73 – Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of other than fraud or any wilful misstatement or suppression of facts.(f) Section 74 – Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any wilful misstatement or suppression of facts.
(ii) The provisional attachment of property of taxable person shall be executed by the Commissioner. (iii) Note that provisional attachment under section 83 can be ‘during investigation’ whereas recovery under section 79 only after ‘final demand’ arises out of any order. (iv) Note also that section 61 is excluded for provisional attachment under this section. As discussed under section 61, GST knows ‘no spot recovery’ arising out of any discrepancy noted in scrutiny of returns. (v) The only condition is that the Commissioner should be of the opinion that for the purpose of protecting the interest of the Government revenue, it is necessary to provisionally attach the property. The Commissioner may also seize bank accounts of such persons, if it is in the interest of revenue. (vi) Such provisional attachment would be valid for one year from the date of the order made by the Commissioner in FORM GST DRC-22. (vii) 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 person, whichever is lower, then such property shall be released forthwith, by an order in FORM GST DRC-23, on proof of payment. Further, where the taxable person fails to pay the aforesaid amount, 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. (viii) Any person whose property is attached may, within 7 days of the attachment file an objection to the effect that the property attached was or is not liable to attachment, and the Commissioner may, after affording an opportunity of being heard to the person filing the objection, release the said property by an order in FORM GST DRC-23. 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 Comparative review These provisions are broadly similar to the provisions contained in erstwhile Finance Act, 1994 (Section 73C) Central Excise Act, 1944 (Section 11DDA) Customs Act, 1962 (Section 28BA) Delhi VAT Act, 2004 (Section 46A) Recommended Articles –
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