Short answer: Yes. Under Section 83 of the CGST Act, the Commissioner may provisionally attach property, including a bank account, where he considers it necessary to protect the revenue. Only the Commissioner can make the order, and it ceases to have effect after one year. Courts have quashed bank freezes ordered by junior officers and directed banks to restore accounts once the year has passed.
What Section 83 allows
Provisional attachment is a protective measure taken while proceedings are pending, before any demand is finally determined. The procedure for attachment and for release or restoration of property is prescribed in Rule 159 of the CGST Rules, 2017. Because the order is made before liability is established, courts have treated the power as one to be exercised strictly within its terms.
Only the Commissioner can order it
In M/s Vikas Enterprises v. Commissioner of Central Tax (GST) (31 July 2023), a Delhi High Court Bench of Justice Vibhu Bakhru and Justice Amit Mahajan quashed a letter from a Superintendent (Anti-Evasion) directing a bank not to allow debits. The Court held that “no order under Section 83 of the CGST Act can be passed by any officer other than the Commissioner”, observed that such attachments adversely affect the business, and imposed costs of Rs 5,000 to be recovered from the Superintendent.
The one-year limit
Section 83(2) provides that every provisional attachment ceases to have effect after one year from the order. In M/s Krish Overseas v. Commissioner Central Tax-Delhi West, reported on 1 May 2024, the Delhi High Court held that “the life of an order of provisional attachment is only one year” and that the bank could no longer restrain the account under a 2019 order. In M/s Sunshine Exim v. DGGI, Jaipur, reported on 28 November 2024, the Rajasthan High Court directed the bank to allow operation of the account once the year had expired.
In September 2023, the CBIC issued an advisory that when an attachment ceases under Section 83(2), the Commissioner should send an intimation to the bank or authority referring to the original order and stating that the account or property stands released, with a copy to the taxpayer. In Tex Fab India v. Union of India, reported on 20 April 2026, the Bombay High Court recorded that an attachment had lapsed and directed that the account be made operational immediately.
Blocking of credit is different
Blocking of the electronic credit ledger under Rule 86A is a separate power. In NZS Traders Pvt. Ltd. v. Union of India, reported on 4 April 2026, the Bombay High Court held that the restriction cannot continue beyond one year and that the credit is unblocked by operation of law. The 57th GST Council has recommended a right to object, with a personal hearing, before credit is blocked.
Related questions
Can my bank freeze the account on a letter from a Superintendent?
The Delhi High Court in Vikas Enterprises held that only the Commissioner can pass an order under Section 83, and quashed a freeze communicated by a Superintendent without the Commissioner’s order.
What happens when one year has passed?
The attachment ceases by operation of law. Write to the Commissioner and the bank citing Section 83(2) and the CBIC advisory of September 2023 and ask for an intimation of release.
Can the attachment be imposed again?
A later attachment needs a fresh, valid order. The Rajasthan High Court in Sunshine Exim indicated that an account cannot be attached again without fresh reasons.
Is blocking of ITC the same as attachment?
No. Rule 86A blocks use of credit in the electronic credit ledger; it is a separate power, also limited to one year.
Practical points
- Ask the bank and the Department for a copy of the attachment order and check that the Commissioner signed or authorised it.
- Check which proceeding the attachment is linked to and whether that proceeding is pending.
- Object in writing with the facts that make attachment unnecessary, and ask for a hearing.
- Offer alternative security where the business needs the account to operate.
- Diary the one-year date and act promptly on lapse.
Sources: LiveLaw, Delhi HC in Vikas Enterprises, 19 August 2023; LiveLaw, Delhi HC in Krish Overseas, 1 May 2024; LiveLaw, CBIC advisory on lapse of attachment, 12 September 2023; LiveLaw Biz, Rajasthan HC in Sunshine Exim, 28 November 2024.
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