Short answer: Yes, but only in ways the statute allows. During a search, officers may issue a restraint order on a bank account or locker, which under the Income-tax Act, 2025 lapses after 60 days, or provisionally attach property with senior approval for up to six months. During assessment, Section 281B of the 1961 Act permits provisional attachment, which courts require to be proportionate to the likely demand.
Restraint orders during a search
Section 247(4) of the Income-tax Act, 2025, which governs searches initiated from 1 April 2026, provides two kinds of restraint. Valuable items that cannot practically be removed may be placed under an order not to remove or deal with them without permission, and that order is deemed a seizure. For other records and assets, including bank accounts, lockers and computer systems, a restraint order may be issued where seizure is not practicable; this is not a seizure, and it lapses after 60 days.
Provisional attachment linked to a search
Section 247(8) allows the authorised officer to provisionally attach the assessee’s property during the search or within 60 days after the last authorisation is executed. The officer must record reasons in writing, be satisfied that attachment is necessary to protect the revenue, and obtain the prior approval of the Principal Director General or Director General, or Principal Director or Director. The attachment is valid for six months from the end of the month in which it is made.
Attachment during assessment under Section 281B
Under Section 281B of the 1961 Act, which continues to govern proceedings for earlier years, property may be provisionally attached during pending assessment or reassessment. In ACIT v. Mohammed Salih, reported on 28 January 2025, a Kerala High Court Division Bench held that money in a bank account is “property” that can be attached, but that attachment must be “commensurate with the probable demand including penalty” and must not be a blanket order over assets far exceeding that demand.
In ARL Infratech Limited v. DCIT (6 March 2026), a Rajasthan High Court Division Bench described the power as “draconian” and set aside an attachment. It held that the assessee should first be given an opportunity of hearing and to pay the demand or part of it, that “A presumption cannot be drawn that the assessee would not make the payment”, and that whether the assessee is a regular taxpayer must be considered.
Seized cash and release
Cash seized in a search may be applied against liabilities determined (Section 132B of the 1961 Act; Section 250 of the 2025 Act). In PCIT v. Kapoor Industries Limited, reported on 31 August 2026, the Delhi High Court held that once the searched person’s assessment was made, the Section 132B charge over the cash ended, and refused to stay the release of about Rs 17.66 crore after adjusting the tax determined.
Related questions
How long can a search restraint on my bank account last?
Under Section 247(4)(b) of the 2025 Act, a restraint order on a bank account lapses after 60 days. A provisional attachment under Section 247(8) is valid for six months from the end of the month in which it is made.
Is money in a bank account “property” that can be attached?
Yes. The Kerala High Court in Mohammed Salih held that “any property” in Section 281B includes money lying in a bank account, while requiring the attachment to match the likely demand.
Can I ask for the attachment to be lifted?
Yes. Ask for a copy of the order and its approval, and apply in writing showing that the attachment exceeds the likely demand, offering security or part payment where appropriate. The Rajasthan High Court has stressed the need for a hearing before such a step.
What should I check when my bank says the account is frozen?
Ask the bank for a copy of the order it received, and check who issued it, under which provision, on what date, and whether the statutory period has expired.
Practical points
- Obtain the restraint or attachment order and the approval behind it.
- Diary the 60-day and six-month periods and write to the bank and the officer when they expire.
- Prepare an estimate of the realistic demand to show that a wider attachment is disproportionate.
- Keep payroll, statutory dues and supplier obligations documented if seeking partial release.
Sources: Income Tax Department, Section 247 of the Income-tax Act, 2025; LiveLaw Biz, Kerala HC on Section 281B, 28 January 2025; LiveLaw Biz, Rajasthan HC in ARL Infratech, 13 March 2026; LiveLaw Biz, Kapoor Industries, 31 August 2026.
For a confidential discussion on income-tax search and assessment matters, see Income-tax Search and Seizure.
General legal information only; not legal advice or solicitation.
