Big danger of GST: One small mistake in buying property and your property can get attached. Money Live

Many people believe that if they have filled all the documents correctly while buying a property, then there will be no legal risk in the future. But there is a rule in the GST law, if you do not understand it, your newly purchased property can also be attached. Under Section 83 and Section 79 of the GST Act, the department has the power to attach movable and immovable property of any person, if the previous owner has huge GST outstanding and it is found that the property was sold to avoid tax liability. In many cases, the old owners sell the property in a hurry to avoid their GST liability, which can put the buyer in trouble. However, in normal property deals, the GST liability is person-specific, not property-specific. That means Seller’s GST Liability does not apply directly to the Buyer. But while purchasing Business Property like Plant, Machinery, Stock or Business Assets, there can be transfer of liability under Section 85. It is most important for the buyer that the Warranty Clause be included in the Sale Deed and the Encumbrance Certificate must be checked. Also, one should be cautious of properties available at unusual discounts because such deals often involve hidden tax disputes.