Cash Credit Account Cannot Be Treated As Property Of Account Holder Which Can Be Considered U/S 83 Of GST Act: Bombay High Court
The Bombay High Court stated that cash credit account cannot be treated as property of account holder which can be consider under Section 83 of GST Act.
The Division Bench of Justices M.S. Sonak and Jitendra Jain observed that the phrase ‘including bank account’ following the phrase, “any property” would mean a non-cash-credit bank account. Therefore, a “cash credit account” would not be governed by Section 83 of the MGST Act.
In this case, the petition has been filed by the assessee/petitioner challenging the action of department/Respondent No.1, under Section 83 of the Maharashtra Goods and Service Tax (MGST Act) whereby the cash credit account of the Petitioner with ICICI Bank has been attached provisionally.
The bench observed that Section 83 of the MGST Act provides for provisional attachment of ‘any property including bank account belonging to the taxable person’. The cash credit account is a liability which an account holder owes to the bank for availing the loan facility and therefore by no stretch of imagination cash credit account can be construed as a property belonging to the account holder/Petitioner.
The bench held that “cash credit account” cannot be treated as “property” of the account holder which can be consider under Section 83 of the Act.
In view of the above, the bench allowed the petition and directed the department to immediately withdraw letter addressed to the ICICI Bank, Malad (E), Mumbai 97 for provisionally attaching the cash credit account of the assessee.
Case Title: Skytech Rolling Mill Pvt. Ltd. v. Joint Commissioner of State Tax Nodal 1 Raigad Division
Case Number: WRIT PETITION NO.1928 OF 2025
Counsel for Petitioner/ Assessee: Tanmay Phadke
Counsel for Respondent/ Department: Amar Mishra
