Case Details: Shree Dhanlaxmi Metal Industries vs. State of Gujarat - [2025] 173 taxmann.com 559 (Gujarat)
Judiciary and Counsel Details
- Bhargav D. Karia & Niral R. Mehta, JJ.
- Saurabh Soparkar, Sr. Adv. & Hardik V Vora for the Petitioner.
- Ms Shrunjal Shah, AGP for the Respondent.
Facts of the Case
The petitioner, a registered taxpayer under the CGST Act, was investigated for fraudulently availing ITC of ?76.68 crores through fake invoices without any actual supply of goods. Based on the investigation, the authorities formed the opinion that immovable properties alone would not be sufficient to secure the revenue, and therefore, issued provisional attachment orders under Section 83, attaching both movable and immovable properties. The petitioner challenged these orders before the Gujarat High Court, arguing that the attachment was unjustified, arbitrary, and lacked sufficient grounds, while also citing Radha Krishan Industries v. State of Himachal Pradesh [2021] 127 taxmann.com 26 (SC) as precedent.
High Court Held
The Hon’ble Gujarat High Court upheld the provisional attachment under Section 83, ruling that the authorities had validly formed an opinion based on tangible evidence, justifying the attachment of both movable and immovable assets. The Court affirmed that the case fell under the second instance of Circular No. 171/03/2022-GST, involving fraudulent ITC claims by the recipient. It also distinguished Radha Krishan Industries due to differing facts and found no evidence of harassment. The petition was dismissed in favour of the Revenue.
List of Cases Reviewed
- Radha Krishan Industries v. State of Himachal Pradesh [2021] 127 taxmann.com 26 (SC) – (para 27) distinguished
List of Cases Referred to
- Radha Krishan Industries v. State of Himachal Pradesh [2021] 127 taxmann.com 26/86 GST 665/48 GSTL 113 (SC) (para 10)
- Arya Metacast (P.) Ltd. v. State of Gujarat [2022] 137 taxmann.com 173/92 GST 70/63 GSTL 174 (Gujarat) (para 12)
- Utkarsh Ispat LLP v. State of Gujarat [2022] 136 taxmann.com 1/92 GST 607 (Gujarat) (para 13)
- Patran Steel Rolling Mill v. Asstt. Commissioner of State Tax, Unit 2 [2019] 101 taxmann.com 80 (Gujarat) (para 14).
The post HC Upheld Provisional Attachment of Movable and Immovable Properties to Protect Revenue Interest Due to Fraudulent ITC appeared first on Taxmann Blog.
