Case Laws Merlin Facilities (P.) Ltd. vs. Union of India

Facts of the Case:

Revenue:

• The revenue had passed an order under Section 83 of the CGST Act, 2017, provisionally attaching the bank accounts of Merlin Facilities (P.) Ltd.
• The revenue claimed that the petitioner was a non-existing person and had not cooperated in the investigation.
• The order was aimed at protecting the government revenue, as the petitioner was suspected of evading taxes.
• However, no further orders were issued for recovering any dues. The revenue defended the constitutionality and validity of Section 13(8)(b) and Section 8(2) of the IGST Act, 2017.

Petitioner:

• Merlin Facilities (P.) Ltd. filed a writ petition challenging the order passed under Section 83 of the CGST Act, which provisionally attached their bank accounts.
• The petitioner argued that they had been falsely implicated and that they had not cooperated in the investigation.
• They claimed that the revenue’s allegations were baseless. The petitioner contended that the provisional attachment order should be set aside as it had caused hindrances in operating their bank accounts.

Judgement:

As per Provisions of Section 83(2) of CGST Act, Operation of an order provisionally attaching bank account would cease to be operative after expiry of statutory period of one year. Therefore, the court held that the impugned order was no longer operative, allowing the petitioner to operate their bank accounts.

Summary:

In the case of Merlin Facilities (P.) Ltd., the Delhi HC ruled that the operation of an order provisionally attaching bank accounts would cease to be operative after the expiration of one year as per Section 83(2) of the CGST Act, 2017. The petitioner had challenged an order under Section 83 that had provisionally attached their bank accounts, but no further orders were issued for recovering any dues. Therefore, the court held that the impugned order was no longer operative, allowing the petitioner to operate their bank accounts.

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