MANU/DSTX/0050/2016

Ministry : Ministry of Finance

Department/Board : Service Tax

Circular No. : 196/06/2016-Service Tax

Date : 27.07.2016

Notification/ Circulars Referred : Circular No. 103/06/2008-Service Tax dated 1.7.2008 MANU/DSTX/0053/2008

Citing Reference:
Circular No. 103/06/2008-Service Tax dated 1.7.2008 MANU/DSTX/0053/2008  Referred

To

All Principal Chief Commissioners of Central Excise and Service Tax/ Customs
All Chief Commissioners, Central Excise and Service Tax / Customs.
Principal Directors General of Goods & Service Tax/ Systems/ Central Excise Intelligence.
Director General of Audit/ Tax Payer Services
All Principal Commissioners/ Commissioners of Central Excise & Service Tax
All Commissioners of Central Excise (Audit) / Service Tax (Audit),
Principal Commissioners/ Commissioners LTU, Joint Secretary TRU-I/TRU-II/Review,
Commissioner, Central Excise (Legal/PAC, Tax Payers Services)

Madam/Sir

Instructions regarding provisional attachment of property under Section 73C of the Finance Act, 1994

I am directed to draw your attention to Section 73C of the Finance Act, 1994, the Service Tax (Provisional Attachment of Property) Rules, 2008 and Circular No. 103/06/2008-Service Tax dated 1.7.2008 on the above subject.

2. Recently, in a case of an assessee whose bank accounts were ordered to be attached without giving any opportunity to them, the Hon'ble Allahabad High Court after a detailed analysis of the legal provisions, observed, inter- alia, that the order directing attachment of the property without waiting for a reply to the show cause notice, and without giving any opportunity and without giving any notice, was in gross violation of Rule 3 of the Rules of 2008 read with paragraph 2 (iii) of the Circular dated 1st July, 2008. It was mandatory for the authority to issue a notice giving 15 days time to reply before attaching a property. The Hon'ble High Court further observed that since proceedings under Section 73 of the Act had been initiated and a show cause notice had already been issued to the petitioner, action for attachment could only have been initiated by the Commissioner and should not have been initiated by the Deputy Commissioner. The Court also directed that a certified copy of the order be sent to the Central Board of Excise & Customs, Department of Revenue, Ministry of Finance with specif........