Change in scope of Section 83 of the CGST Act-
Background:
As per the current provisions of sub-Section (1) in Section 83 of CGST
Act -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.”
As we can see under older sections covered only fewer sections while
there could be endless reason for loss of revenue, hence in order to make it
wider and to protect revenue the Hon’ble Finance Minister, in Union Budget
2021-22, proposed changes vide the Finance Bill, 2021, that amends the Central
Goods and Services Tax Act, 2017 (“the CGST Act”) with respect to provisional
attachment of property/bank account. Accordingly, amended Bill was passed in
Rajya Sabha, the upper house, and it received presidential assent vide Finance
Act, 2021.
The CBIC vide Notification No. 39/2021–Central Tax dated December 21,
2021 notified the below mentioned amendments made vide Section 115 of the
Finance Act, 2021 w.e.f. January 01, 2022: Where, after the initiation of
any proceeding under Chapter XII, Chapter XIV or Chapter XV, 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 or any person specified in sub-section (1A) of section 122, in such manner
as may be prescribed.”
Comparison-
Section 83(1) of the CGST Act that deals with provisional attachment of
any property to protect revenue, has been amended in a manner, to widen the
scope of the power to
provisionally attach any property by replacing specified Sections
covered therein with complete Chapters of the CGST Act. Also, it is provided
that provisional attachment shall remain valid for the entire period starting
from the initiation of any proceeding under Chapter XII (assessment), Chapter
XIV (inspection, search, seizure and arrest) or Chapter XV (Demands and
Recovery) till the expiry of a period of one year from the date of order made
thereunder.
In addition, the Commissioner is now empowered to provisionally attach, property belonging to any persons who retain the benefits arising out of an offence or at whose instance the offence is committed.
As we can see instead of fewer section now provision empowers officer
for whole of Chapter XII, XIV & XV.
In one line we can say it can be harsh on assesses and on other hand it
empowers officer more.
Disclaimer- This is Author views , only for education purpose & Do not constitute any legal advice.
Please connect your consultant for any legal advice.
