GST / Indirect Tax : Power and Procedure under S.83 of CGST Act, 2017 in Respect of Attachment of Bank Accounts by Tax Department

GST / Indirect Tax : Power and Procedure under S.83 of CGST Act, 2017 in Respect of Attachment of Bank Accounts by Tax Department

Recently, in case of Kanta Food Product v. Union of India [2025] GCtR 1562 (Delhi) the scope of S.83 of CGST Act, 2017 was discussed.

In case of KPN Travels India Ltd v. DGGST Intelligence [2022] GCtR 1995 (Madras), scope of S.83 of CGST Act, 2017 was also explained with respect to bank account attachment. Tax Department official has invoked that power "in order to protect the interest of the Revenue" to provisionally attach the bank account. The order passed by Tax Department failed to pass legal scrutiny and they were set aside. 

Now, we can see that both these findings clearly chalk out the scope of S.83 of CGST Act, 2017. When KPN Travels laid down the law in the year 2022, should it not be asked as to how the Tax Department officials have ignored that principle and passed another order due to which the case of Kanta Food arose ? 

Are Tax Department officials unaware of law passed in the year 2022 and are they are at liberty to ignore and act in contravention of law laid down in the year 2022 ? This certainly cannot be a tenable ground because Tax Department officials are educated individuals and they are presumed to have knowledge of law. If the argument that Department officials were unaware of law laid down in various Judgments, it would lead to anarchy because Department officials would start ignoring every judgment in order to take an excuse of their ignorance. Hon'ble Courts and Department should devise a mechanism where ignorant Tax Officials are penalised monetarily and Tax Officials who pass orders based on judicial precedents are rewarded. This can be easily done by imposing exemplary costs to be recovered from salary/pension of concerned Tax Department Official as doing so would be clearly in line with law laid down in PSPCL v. Atma Singh Grewal [2013] GCtR 6208 (SC) as well as by initiating contempt proceedings against such Tax Department Officials. If that's not done, the business-friendly atmosphere will be difficult to be developed. 

Link of the Article discussing Kanta Food Product Case  is given below : 

https://vishallegalghy.blogspot.com/2025/09/gst-indirect-tax-attachment-of-bank.html