Sec 83 – Provisional attachment to protect revenue in certain cases

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Sec 83 – Provisional attachment to protect revenue in certain cases 2017-04-14T11:28:41+00:00

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  • Ashish BadalaCA Ashish Badala
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    (1) 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.
    (2) Every such provisional attachment shall cease to have effect after the expiry of a period of one year from the date of the order made under sub-section (1).

    Priya MadrechaPriya Madrecha
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    83.1    Introduction
    This section confers power to provisionally attach the property of the taxable person in certain situations to protect the interest of the Government.
    83.2    Analysis
    (i)    This section applies only during the pendency of any proceedings under (a)     Section 62 – Assessment of non-filers of returns.
    (b)    Section 63 – Assessment of unregistered persons.
    (c)    Section 64 – Summary assessment in certain special cases.
    (d)    Section 67 – Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized for any reason other than fraud or any wilful misstatement or suppression of facts.
    (e)    Section 73- Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any wilful misstatement or suppression of facts.
    (f)    Section 74- Power of inspection, search and seizure
    (ii)    The provisional attachment of property of taxable person shall be executed by the Commissioner.
    (iii)    The only condition is that the Commissioner should be of the opinion that for the purpose of protecting the interest of the Government revenue it is necessary to provisionally attachment the property. The commissioner may seize bank accounts of such persons if it is in the interest of revenue.
    (iv)    Such provisional attachment would be valid for one year from the date of the order made by the Commissioner.
    83.3    Comparative review
    These provisions are broadly similar to the provisions contained in existing
         Finance Act, 1994 (Section 73C)
         Central Excise Act, 1944 (Section 11DDA)
         Customs Act, 1962 (Section 28BA)
         Delhi VAT Act, 2004 (Section 46A)
    83.4    Related provisions
    Section     Description
    62     Assessment of non-filers of returns.
    63     Assessment of unregistered persons.
    64     Summary assessment in certain special cases.
    67     Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized for any reason other than fraud or any wilful misstatement or suppression of facts.
    73     Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any wilful-misstatement or suppression of facts.
    74     Power of inspection, search and seizure.
    83.5    FAQs
    Q1. Provisional attachment shall be applicable to which proceedings?
    Ans. Provisional attachment shall be applicable for the following pending proceedings of a taxable person,
    1.    Assessment of non-filers of returns.
    2.    Assessment of unregistered persons.
    3.    Summary assessment in certain special cases.
    4.    Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized for any reason other than fraud or any wilful misstatement or suppression of facts.
    5.    Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any wilful-misstatement or suppression of facts.
    Q2. What is the condition for provisionally attaching the property of a taxable person?
    Ans. The Commissioner should be of the opinion that for the purpose of protecting the interest of the Government revenue it is necessary to do so.
    Q3. Why attachment to be done before conclusion of proceedings?
    Ans. Attachment to be done before conclusion of proceedings, if Commissioner is of the opinion that there is risk of recovery and to protect interest of revenue.
    83.6 MCQ
    1.    Till what period does the order passed for provisional attachment is valid?
    (a)    Infinite period
    (b)    One year
    (c)    Ten years
    (d)    till the end of the such proceedings
    Ans. (c) One year
    2.    Who is the competent authority for passing an order for provisional attachment?
    (a)    The Deputy Commissioner
    (b)    The GST Council
    (c)    The Commissioner
    (d)    The Assistant Commissioner
    Ans. (b) The Commissioner
    3.    Attachment can be done under section 83:
    (a)    Before completion of proceedings.
    (b)    After completion of proceedings.
    (c)    After 3 attempts to recover dues.
    (d)    Only if there is risk of delinquency in payment of dues.
    Ans. (a) Before completion of proceedings

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