Recovery cannot begin on day one — Section 78
An adjudication order must be paid within three months of its service; only then can recovery proceedings commence. The officer can shorten this period only for reasons recorded in writing in the interest of revenue. Equally important: filing a first appeal with the 10% pre-deposit under Section 107(6) operates as a statutory stay of the balance under Section 107(7) — and the Tribunal appeal with its additional 10% continues that stay. The Patna High Court's guidelines in the Sita Pandey line deprecate recovery within the appeal window, and courts have ordered refunds — with personal costs on officers — where amounts were swept from bank accounts days after a demand, ignoring the appeal remedy.
Garnishee notices — DRC-13 has real limits
Section 79(1)(c) lets the department order your bank, debtor or customer to pay your GST arrears directly to the Government. But the provision reaches only persons who actually owe money to the defaulter or hold money on the defaulter's account. The Karnataka High Court in Ramms India Pvt. Ltd. (December 2025) quashed a ₹24.73 lakh recovery made from a company's bank account merely because it shared a common director with the defaulter — separate companies are separate taxpayers, and the corporate veil is lifted only on demonstrated fraud. The Madras High Court has added the equally basic rule: no arrears, no recovery — amounts already paid cannot be garnisheed. And the Bombay High Court (April 2026) has held that recovery from a legal heir's account without first determining the heir's liability under Section 93, on notice and after hearing, is a jurisdictional error.
Provisional attachment — a one-year, tangible-material power
Section 83 allows the Commissioner to provisionally attach property, including bank accounts, to protect revenue during proceedings. The Supreme Court in Radha Krishan Industries called this power ‘draconian’: it demands the Commissioner's own opinion, formed on tangible material with a live nexus to protecting revenue — not a routine adjunct to every investigation. You have the right to object within seven days (Form DRC-22A) and to be heard. And by law the attachment ceases automatically after one year. The Supreme Court in Kesari Nandan Mobile (2025) closed the last loophole: a lapsed attachment cannot be renewed or reissued on substantially the same material. Delhi High Court decisions add that once a demand is confirmed, the department must use the recovery provisions — it cannot keep re-attaching under Section 83.
Even ‘self-assessed’ dues need due process
The one situation where the department can recover without a show cause notice is self-assessed tax — declared in GSTR-1 but unpaid in GSTR-3B (Section 75(12)). Yet even here, the rules now require an intimation (Forms DRC-01B/01C for mismatches, DRC-01D for recovery), and the Gujarat High Court in Bombay Art (2025) held that even self-assessed interest cannot be recovered by a direct bank attachment without first issuing DRC-01D and hearing the taxpayer. Due process attaches to every recovery mode.
Your immediate checklist if recovery action hits
1. Check whether three months from the order have passed, and whether any early-recovery reasons were recorded. 2. If you are in the appeal window, file the appeal with pre-deposit immediately — the statutory stay follows, and attachments must be lifted. 3. Against a Section 83 attachment, file DRC-22A objections within seven days and verify the one-year life. 4. If a DRC-13 has gone to your customers or bank, test whether the recipient actually owes you money and whether the demand is even crystallised. 5. Preserve everything — courts have consistently refunded amounts recovered in breach of these rules.
DSRV & Co. LLP handles urgent recovery-defence matters — attachment objections, representations to recovery officers, appellate stays and writ remedies — alongside the underlying demand litigation. If your account has been attached or your customers have received DRC-13 notices, time is critical; contact our GST litigation team.
