What does Rule 144 of the Central Goods and Services Tax Rules, 2017 provide?

Rule 144 provides the procedure for recovery of amounts due from a defaulter by selling goods belonging to such person that are under the control of the proper officer, including inventory preparation, valuation, and sale of only so much of the goods as required to recover the amount and administrative expenses.

How are goods sold under Rule 144 for GST recovery?

Under Rule 144, goods are sold through a process of auction, including e-auction, after issuing a notice in FORM GST DRC-10 specifying the goods to be sold and the purpose of the sale.

When can goods be sold forthwith under Rule 144?

Goods may be sold forthwith under Rule 144 if they are of perishable or hazardous nature or if the expenses of keeping them in custody are likely to exceed their value.

Which GST forms are used in the auction process under Rule 144?

Under Rule 144, FORM GST DRC-10 is used for the auction notice, FORM GST DRC-11 is issued to the successful bidder for payment, and FORM GST DRC-12 is issued as a certificate on transfer of possession of the goods.

CGST Rule 144 of Central Goods and Services Tax Rules, 2017 – Recovery by sale of goods under the control of proper officer

The Central Goods and Services Tax Act, 2017

The Central Goods and Services Tax Rules, 2017

Chapter-XVIII Demands and Recovery

Rule 144: Recovery by sale of goods under the control of proper officer.

144. (1) Where any amount due from a defaulter is to be recovered by selling goods belonging to such person in accordance with the provisions of clause (b) of sub-section (1) of section 79, the proper officer^c1 shall prepare an inventory and estimate the market value of such goods and proceed to sell only so much of the goods as may be required for recovering the amount payable along with the administrative expenditure incurred on the recovery process.

(2) The said goods shall be sold through a process of auction, including e-auction, for which a Notice shall be issued in FORM GST DRC-10 clearly indicating the goods to be sold and the purpose of sale.

(3) The last day for submission of bid or the date of auction shall not be earlier than fifteen days from the date of issue of the Notice referred to in sub-rule (2):

Provided that where the goods are of perishable or hazardous nature or where the expenses of keeping them in custody are likely to exceed their value, the proper officer^c1 may sell them forthwith.

(4) The proper officer^c1 may specify the amount of pre-bid deposit to be furnished in the manner specified by such officer, to make the bidders eligible to participate in the auction, which may be returned to the unsuccessful bidders, forfeited in case the successful bidder fails to make the payment of the full amount, as the case may be.

(5) The proper officer^c1 shall issue a Notice to the successful bidder in FORM GST DRC-11 requiring him to make the payment within a period of fifteen days from the date of auction. On payment of the full bid amount, the proper officer^c1 shall transfer the possession of the said goods to the successful bidder and issue a certificate in FORM GST DRC-12.

(6) Where the defaulter pays the amount under recovery, including any expenses incurred on the process of recovery, before the issue of the Notice under sub-rule (2), the proper officer^c1 shall cancel the process of auction and release the goods.

(7) The proper officer^c1 shall cancel the process and proceed for re-auction where no bid is received or the auction is considered to be non-competitive due to lack of adequate participation or due to low bids.

References

Enforcement:

Enforced w.e.f. July 01, 2017 [Notification No. G.S.R. 819(E) dated 01.07.2017].

Circulars:

c1. Proper officer relating to provisions other than Registration and Composition, refer Circular No. 3/3/2017-GST dated 05.07.2017.

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