Facing GST Attachment? Here’s Where to Go First
When a taxpayer faces GST attachment of bank accounts or property, the first instinct is to rush to the court. But a recent Delhi High Court ruling has clarified the legal route: approach the GST Commissioner first, not the court.
This blog simplifies the procedure, legal basis, and practical steps to handle GST attachment issues effectively.
What is GST Attachment?
GST authorities can provisionally attach a taxpayer’s:
- Bank accounts
- Property (movable or immovable)
- Receivables or assets
Key Judicial Ruling: Court Says Approach Commissioner First
In Rajkamal Builders Infrastructure Pvt. Ltd. v. Commissioner of CGST (2024), the Delhi High Court ruled:
“When a bank account is attached under Section 83, the taxpayer must first file a representation before the Commissioner under Rule 159(5) before seeking court intervention.”
Legal References:
| Provision | Description |
|---|---|
| Section 83, CGST Act | Provisional attachment to protect revenue |
| Rule 159(5) | Taxpayer can file an objection against attachment |
| Delhi HC Ruling (2024) | Courts won’t interfere unless Rule 159(5) route is exhausted |
Steps to Handle GST Attachment
1. Understand the Notice
- Identify under which proceedings the attachment is made (assessment, inspection, etc.).
- Check the authority issuing the notice.
2. File Objection under Rule 159(5)
- Submit a written representation to the jurisdictional Commissioner.
- Explain why attachment is not necessary (e.g., no revenue loss, cooperation with investigation, financial hardship).
3. Wait for Commissioner’s Response
- The Commissioner is expected to pass a reasoned order.
4. Still Aggrieved? Move High Court
- Only after exhausting Rule 159(5), file a writ petition under Article 226 of the Constitution.
Why Courts Are Pushing This Route
- Promotes fair hearing by tax officers first.
- Reduces frivolous litigation and delays.
Expert Tip: Build a Strong Representation
A vague or emotional letter won’t help. When filing under Rule 159(5), ensure:
- Attach bank statements, tax records, financials
- Demonstrate your cooperation with GST officials
- Prove that attachment is excessive or unjustified
FAQs on GST Attachment
Q1. Can GST authorities freeze my account without notice?
A: No. Section 83 requires formation of opinion and attachment must be supported by reasons recorded in writing.
Q2. What if my business operations stop due to attachment?
A: This can be used as a valid ground in your Rule 159(5) representation to seek release.
Q3. Is there a time limit to file under Rule 159(5)?
A: While no strict timeline is prescribed, file it immediately upon receipt of attachment order.
Conclusion: Facing GST Attachment? Act Smart, Not Fast
Running to court may feel urgent, but unless you first approach the GST Commissioner under Rule 159(5), courts may dismiss your plea. Handle it lawfully, strategically, and with expert support.
📌 Need help with GST attachment or filing a strong Rule 159(5) objection?
Get expert help with Efiletax today →
Summary
Facing GST bank attachment? As per Delhi HC, you must first file a representation under Rule 159(5) of CGST Rules before going to court. Learn the legal route, key judicial ruling, and expert tips to respond effectively and safeguard your business.