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UMy father’s friend was running a business since almost 20 years ago. My mother was director in the company during 2017-2019. During this time, one of the employees responsible for filing GST returns was working carelessly and failed to file GST on time, multiple times. Because of this, my mother is now held liable for fraud. Now the GST officers have started sending notices and and claim to have attached our residential house as immovable property for compensation. It is a very big amount which we are unable to pay. All our other assets are on mortgage and we are barely scraping by on rent from another flat.
Is there any way to atleast save our house?
Will bankruptcy help in alleviating this situation? If so, how? -
BLawyer here, based in Delhi.
If your mother was the only director during that period, she will almost certainly be held responsible for the company’s GST compliance. Under the law, the presumption is that she was in charge of day-to-day affairs, and the chances of avoiding liability are slim.
However, if the house is in her personal name and not owned by the company, and if no proper adjudication or hearing took place before attachment, you may still be able to challenge it through a writ petition. Bankruptcy is an option only if she is personally declared liable and cannot pay, but it is a serious process with long-term consequences and should be considered carefully.
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UIs there something we can prove to get the house out of the attachment order? There indeed didn’t seem to be any hearing from court before they sent us the notice for attachment. They just sent an agent on Friday, who brought the notice with him.
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