The order directing furnishing of the bank guarantee needs to be stayed till disposal of the writ petition
Section 83 of the CGST Act, 2017---Provisional Attachment of Bank Accounts -- The Petitioner challenged the orders of attachment of bank accounts under Section 83 of the Act. A Search and inspection under Section 67 was conducted and it resulted in provisional attachment of bank accounts of the petitioner. Lateron the respondent has modified the conditions for furnishing bank guarantee. The counsel for the petitioner submitted that imposing the condition of furnishing the bank guarantee is totally impermissible and illegal. The petitioner counsel relied on the judgment of the Hon'ble Division Bench of the Gujarat High Court in the matter of Valerius Industries V. Union of India and that of the Hon'ble Bombay High Court in in AJE India Private Limited V. Union of India and Ors. decided on 22.10.2020 to substantiate his contention that there cannot be an order directing furnishing of the bank guarantee. The respondent counsel submitted that the attachment order has been lifted with a direction to furnish bank guarantee and the petitioner can resort to the appellate remedy, if he is factually aggrieved by the modi?cation of provisional attachment. The court observed that after search further proceedings are still pending. The orders do not reflect anything which substantiates that interest of revenue requires action of furnishing bank guarantee to be taken in the matter. Furnishing bank guarantee of about Rs. 30 crores would certainly block that much amount from the business of the petitioner.
Held that:- The Hon’ble High Court stayed the order directing furnishing of the bank guarantee till disposal of the writ petition, by directing the petitioner to furnish undertaking before this Court by way of an affdavit that it shall not alienate any of its ?xed assets, plant, property and equipments shown in the balance sheet dated 31.03.2020.