Punnimti Usha Rani VS Union Of India

The writ petitions, 9213 of 2019 and 21402 of 2020, are brought forth by the same petitioners. In Writ Petition No. 9213 of 2019, the petitioners challenge the legality of certain proceedings initiated by the 3rd respondent. Specifically, they contest the provisional attachment of the bank account of the 1st petitioner and others under Section 83 of the Central Goods and Services Tax Act, 2017 (CGST Act, 2017). Additionally, they challenge a notice issued by the Deputy Director on the approval of the 3rd respondent, dated 09.07.2019, which informed the Branch Manager of Laxmi Vilas Bank, Guntur, about the scheduled opening of bank lockers on 24.07.2019. The petitioners argue that these actions are illegal and contrary to the provisions of the CGST Act and its rules, as well as violative of various articles of the Constitution of India, including Articles 14, 19(1)(g), 21, and 300(A), and principles of natural justice. They seek to set aside these proceedings.

In Writ Petition No. 21402 of 2020, the petitioners challenge proceedings initiated by the 3rd respondent, as well. They contest the legality of the proceedings dated 06.03.2020, outlined in F.No.DGGSTII/VZU/INV/GST/13/2019, as well as a consequential letter dated 09.11.2020 issued by the Deputy Director on the approval of the 3rd respondent, as detailed in F.No.DGGI/VZU/INV/GST/13/2019/2044. Similarly to the first writ petition, the petitioners argue that these actions are in violation of the CGST Act and its rules, as well as various articles of the Constitution of India and principles of natural justice.

In both petitions, the petitioners seek to challenge the actions taken by the respondents, alleging illegality, procedural impropriety, and violation of constitutional rights and principles of natural justice. They request the court to set aside the impugned proceedings and provide appropriate relief.

These writ petitions, filed by the same petitioners, address different instances of alleged illegal proceedings by the tax department.

Writ petition No. 9213 of 2019 challenges actions taken under the Central Goods and Services Tax Act, 2017 (CGST Act, 2017), including the provisional attachment of bank accounts and a notice regarding the opening of bank lockers. The petitioners argue that these actions are illegal, violating various provisions of the CGST Act, as well as constitutional rights and principles of natural justice.

On the other hand, writ petition No. 21402 of 2020 contests proceedings initiated in 2020, objecting to a letter authorizing the opening of bank lockers. Similar to the first petition, this action is deemed illegal, arbitrary, and in violation of the CGST Act and fundamental rights guaranteed by the Constitution.

The respondent department presents its case, alleging that one Vennapusa Venkata Subba Reddy, along with the first petitioner and others, engaged in fraudulent activities involving fake Input Tax Credit (ITC) invoices between July 2017 and February 2019. These invoices were issued in the names of fictitious or shell firms, without actual supply of goods, violating the CGST Act and its rules. Investigations revealed that no legitimate businesses operated from the premises associated with these firms, indicating fraudulent CGST registrations.

In summary, the petitions challenge actions taken by the tax department in relation to alleged fraudulent activities involving fake invoices and misuse of the CGST Act provisions. The petitioners argue that the actions are illegal, arbitrary, and violate their constitutional rights, while the department contends that these actions are justified based on investigations into fraudulent practices.

These two writ petitions, filed by the same petitioners, address separate instances of alleged procedural irregularities and violations of rights concerning the attachment of bank accounts and the authorization to open bank lockers.

In Writ Petition No. 9213 of 2019, the challenge is against the provisional attachment of the bank account of the first petitioner, along with others, under Section 83 of the Central Goods and Services Tax Act, 2017 (CGST Act, 2017). Additionally, it contests a notice issued by the Deputy Director regarding the opening of bank lockers. The petitioners argue that these actions are illegal, contrary to the provisions of the CGST Act, and violate various articles of the Constitution of India, as well as principles of natural justice. They seek to set aside these proceedings.

On the other hand, Writ Petition No. 21402 of 2020 challenges proceedings from a different date, where the bank locker of the first petitioner and her son was authorized to be opened. Similar to the previous petition, this action is deemed illegal, arbitrary, and contrary to the CGST Act and its rules, as well as violative of fundamental rights under the Constitution of India. The petitioners seek to invalidate these proceedings as well.

The respondent department alleges that Vennapusa Venkata Subba Reddy, along with accomplices including the first petitioner, engaged in fraudulent activities involving fake Input Tax Credit (ITC) invoices. These invoices were purportedly issued on a large scale in the names of fictitious/shell firms in Andhra Pradesh and Telangana, without actual supply of goods, violating the CGST Act, 2017 and its rules. Investigations revealed the operation of around 90 different firms by Subba Reddy for this purpose, forming a network to evade detection. Subba Reddy was arrested and remanded to judicial custody for these violations.

As part of the investigation, the registered business premises of the first petitioner’s firm were searched, revealing an open vacant land without any operating business. Similarly, another searched premises showed no evidence of business operations. These findings are presented as evidence of the alleged fraudulent activities.

The respondent officials maintain that the actions taken, including the provisional attachment of bank accounts and authorization to open bank lockers, were part of their investigation into these fraudulent activities. They argue that these actions were warranted given the seriousness of the alleged violations.

In summary, the petitioners allege procedural irregularities and rights violations in the actions taken by the respondent department, while the respondents argue that their actions were justified as part of an investigation into fraudulent activities. The court will need to weigh the evidence presented by both parties to determine the legality and validity of the proceedings in question.

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