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Applicable Section: Section 83 of Goods & Services Tax Act, 2017
Applicable Rule: Rule 159(5) of Central Goods and Services Tax Rules, 2017
Section 83 deals with Provisional attachment to protect revenue in certain cases. It states that where after initiation of proceedings under Chapter XII, Chapter XIV or Chapter XV, the Commissioner is of the opinion that for the purpose of protecting the interest of the Government revenue it is necessary so to do, he may, by order in writing, attach provisionally, any property, including bank account, belonging to the taxable person or any person specified in sub-section (1A) of section 122, in such manner as may be prescribed in Rule 159. Every such provisional attachment shall cease to have effect after the expiry of a period of one year from the date of the order.
Rule 159. Provisional attachment of property
Rule 159 further provides that where the Commissioner decides to attach any property, including bank account in accordance with the provisions of section 83, he shall pass an order in FORM GST DRC-22 to that effect mentioning therein, the details of property which is attached. The Order shall be further sent to the concerned Revenue Authority or Transport Authority or any such Authority to place encumbrance on the said movable or immovable property, which shall be removed only on the written instructions from the Commissioner to that effect, or on expiry of a period of one year from the date of issuance of order whichever is earlier.
If the attached property is perishable or hazardous and the owner pays either the market price of the property or the amount they owe (whichever is lower), the property will be immediately released upon proof of payment. This release will be formalized through an order in FORM GST DRC-23.
Also, if the person fails to pay the required amount for their perishable or hazardous property, the Commissioner can sell the property. The money obtained from the sale will be used to cover the tax, interest, penalty, fee, or any other amount the person owes.
Objection in Form GST DRC-22A (9Rule 149(5)):
Any person whose property is attached may file an objection in FORM GST DRC-22A to the effect that the property attached was or is Not liable to attachment, and the Commissioner may, after affording an opportunity of being heard to the person filing the objection, release the said property by an order in FORM GST DRC- 23
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