Automatic stay on GST appeal led to withdrawal of bank account debit freeze and restoration of access

A provisional attachment and debit freeze on bank accounts under the CGST Act could not continue after an appeal was filed against the order-in-original. Filing the appeal under Section 107 was treated as operating as an automatic stay of the order dated 28 January 2025, so the freezing communication had to be withdrawn. The bank was directed to lift the debit freeze from all accounts opened under the same PAN, and the accounts were de-frozen.

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Issues: Whether the bank accounts provisionally attached and debit-frozen under the Central Goods and Services Tax Act, 2017 could continue to remain frozen after an appeal had been filed against the order-in-original, and whether the accounts were liable to be de-frozen.

Analysis: The appeal against the order-in-original had already been filed under Section 107 of the Central Goods and Services Tax Act, 2017. In view of that filing, the order dated 28 January 2025 was treated as automatically stayed. The communication freezing the accounts was therefore required to be withdrawn, and the bank was directed to lift the debit freeze from all the accounts opened in the same PAN.

Conclusion: The accounts were directed to be de-frozen and the debit freeze was lifted.

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