Illegal Bank Account Attachment Violates Right To Property Under Article 300A; Bombay High Court Imposes ₹25K Costs On Officer

The Bombay High Court has held that continued attachment of a bank account without complying with statutory requirements violates the right to property under Article 300A of the Constitution. The Court observed that such coercive action, taken in breach of mandatory legal safeguards, results in serious civil consequences and cannot be sustained.

A division bench of Justices G. S. Kulkarni and Aarti Sathe was hearing a writ petition challenging provisional attachment orders dated 23.01.2026 issued by the State Tax authorities attaching its bank accounts. The petitioner contended that the attachment was effected without formation of any opinion, without following due procedure, and without issuance of a proper show cause notice, despite the petitioner submitting objections and offering alternate security.

The Court examined the statutory framework governing provisional attachment and noted that such power is drastic in nature and must be exercised strictly in accordance with law. It observed that the formation of opinion based on tangible material is a mandatory requirement and must precede any such attachment. The Court found that in the present case, even the pre-intimation issued on the same day as the attachment did not disclose any such opinion or material.

The Court further noted that the authorities had failed to adhere to the settled legal principles governing provisional attachment, including those laid down by the Supreme Court. It held that the impugned action demonstrated a complete disregard of statutory safeguards and amounted to an arbitrary exercise of power.

The Court observed that the petitioner's bank accounts were attached without proper notice and that the attachment continued despite the petitioner's representation pointing out legal defects and offering alternate security.

The Court emphasised that attachment of a bank account directly affects business operations and deprives the petitioner of its right to property, thereby causing serious prejudice. It held that the continuation of such attachment for months without following due process violated Article 300A. It observed:

“… attachment has continued to operate for three months depriving the Petitioner of the valuable right guaranteed under Article 300A of the Constitution of India apart from the petitioner being put to a live death on the business being brought at a standstill. This has certainly resulted into civil consequences and serious prejudice to the Petitioner in complete breach of the principles of law.”

Taking serious note of the conduct of the concerned officer, the Court observed that mere setting aside of such orders would not be sufficient. Accordingly, the High Court quashed the impugned attachment orders and directed the concerned Joint Commissioner to deposit costs of Rs. 25,000/- with the Maharashtra State Legal Services Authority.

Case Title: Nivara Infradevelopers LLP vs. Union of India & Ors. [Writ Petition (L) No. 7888 of 2026]

Citation: 2026 LiveLaw (Bom) 184

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