Facts of the Case

The Petitioner, M/s Pashupati Properties Estate Private Limited, filed a writ petition challenging a letter dated 07 December 2020 issued by the Respondent authority under Section 83 of the CGST Act, 2017.

Through the said letter, the Respondent directed the bankers of the Petitioner to provisionally attach an immovable property situated at Rajokari, New Delhi.

The Petitioner further sought directions for de-freezing and release of the attached immovable property, contending that the provisional attachment continued without proper legal backing.

Issues Involved

  1. Whether a provisional attachment under Section 83 of the CGST Act remains valid beyond one year from the date of the order.
  2. Whether the Respondent can continue attachment without issuing fresh orders or show cause notice under Section 74.
  3. Whether the Petitioner is entitled to release of attached property and bank accounts.

Petitioner’s Arguments

  • The provisional attachment dated 07 December 2020 had exceeded the statutory period of one year prescribed under Section 83(2) of the CGST Act.
  • No fresh attachment order in Form GST DRC-22 had been issued after the initial attachment.
  • No show cause notice under Section 74 of the CGST Act had been issued to justify continuation of proceedings.
  • Continued attachment of property and bank accounts was illegal and violative of statutory provisions.

Respondent’s Arguments

  • The Respondent’s counsel admitted that:
    • No fresh attachment order had been issued after December 2020.
    • No show cause notice under Section 74 had been issued till date.

Court’s Findings / Order

The Delhi High Court held:

  • As per Section 83(2) of the CGST Act, every provisional attachment ceases to have effect after expiry of one year from the date of the order.
  • Since no fresh attachment order was issued and the statutory period had expired, the impugned attachment was no longer valid.
  • The Court directed the Respondent to:
    • Defreeze the bank accounts
    • Release the immovable property of the Petitioner

The directions were ordered to be complied with within three days.

Important Clarification

  • Provisional attachment under Section 83 is time-bound and automatically lapses after one year.
  • Authorities cannot continue attachment indefinitely without issuing fresh orders.
  • Absence of proceedings under Section 74 further weakens the basis of attachment.


 Link to download the order -  https://delhihighcourt.nic.in/app/case_number_pdf/2022:DHC:878-DB/MMH08032022CW36242022_184357.pdf

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