Provisional Attachment Not To Hamper Normal Business Activities: Gujarat High court Quashes Attachment Order

The Gujarat High Court bench of Justice J.B. Pardiwala and Justice Nisha M. Thakore has held that the provisional attachment should not hamper normal business activities of the taxable person. The assessee submitted that apart from the properties, the department has also seized the mobile phone, laptop, and other documents from the business premises of the writ applicants by passing the seizure order. The court relied on the decision of the Gujarat High Court in the case of Valerius Industries Vs. Union of India, in which it was held that the power of provisional attachment under section 83 of the Gujarat Goods and Services Tax Act, 2017 should be exercised by the authority only if there is reasonable apprehension that the assessee may default on the ultimate collection of the demand that is likely to be raised on completion of the assessment. "So far the prayer of the writ applicants with regard to release of electronic items including Mobile Phone, laptop and other documents seized during the search proceedings are concerned, same is also directed to be released forthwith on condition that the writ applicants shall file an undertaking before the respondent thereby declaring that the aforesaid goods electronic items including mobile phone, laptop and other seized documents shall be retained in its original form and shall not be disposed of pending the investigation, if any.