AP HC: No Authority to Summon Third Party to Prevent GST Payment U/S 70

The department or Proper Officer has no authority under section 70 of the Goods and Service Tax Act, 2017 to summon of Party to stop all Payments related to GST, ruled by the Andhra Pradesh High Court.

Sri Sai Balaji Associates, the applicant contested the notice under Section 70 (1) of GST Act, 2017 furnished through the 3rd respondent to M/s. Sterlight technologies limited, Vishakapatnam who are the customers of the applicant with directions to stop GST payment.

The applicant, the respondent as per section 70(1) of the GST act would have the power to summon any individual whose attendance would be recognized as critical either for providing the proof or producing the document or any additional things in any inquiry in an identical way, but the same authority would not be extended to direct the summoning of the party to stop the additional payments, which he needed to obtain through the client.

It was proof that the impugned notice was being provided under Section 70(1) of the GST Act but not under Section 83 of the GST Act. Section 70 (1) of the GST act only states that the proper officer will secure the authority to summon any individual whose attendance is acknowledged as critical either to provide evidence or to produce a document or any other thing in the inquiry.

The proper officer could not use the powers to render the summoning party in order to stop the taxpayer’s payment under section 70(1) of the GST act which is above the scope of 70 (1) of the GST Act.

When the commissioner learns that to secure the revenue of the government Under Section 83 of the GST Act, he might order the provisional attachment of any property along with the bank account that belongs to the taxable individual or any individual mentioned in sub-Section 1 (A) of Section 122 in such manner as defined.

The impugned notice was being provided under section 70 (1) of the GST act as noticed by the two-member bench that consists of Justices Durga Prasad Rao & Justice V. Gopala Krishna Rao, however not in the practice of power granted under Section 83 of the GST Act and ruled the direction as above the jurisdiction of the 3rd respondent.

The court set aside the impugned part of the notice provided under section 70 (1) of the GST act at the time of permitting the petition and a liberty would have been provided to the third respondent to move by the regulation for the other portion of the notice provided through him beneath section 70 (1) of GST Act is interested.