None of the ingredients which are prerequisites for the exercise of powers under Section 67(2) of the CGST Act, were present in instant case, accordingly the search and seizure conducted by CGST Delhi North Commissionerate are declared unlawful.
Section 67 of the CGST Act, 2017— Search and Seizure – The petitioner prayed for quashing the order of prohibition dated 05.03.2021, whereby goods have been detained; issuance of direction like a mandamus to the respondents to release the goods detained; to declare the search conducted as illegal. The petitioner is engaged in the business of trading in cigarettes which are supplied to it by authorised dealers of well-known manufacturing companies. Officers from a different Commissionerate CGST Commissionerate, Gautam Budh Nagar visited his premises on 05.03.2021 and searched the premises. An order of prohibition dated 05.03.2021 in Form GST INS – 03 by Inspector who is not a proper officer, was also passed. The petitioner submitted that there was no investigation pending before CGST Commissionerate and therefore, the search, seizure and authorization issued by respondent was unlawful. The court observed that Additional Commissioner, CGST Delhi North Commissionerate exercised his powers for authorizing staff of other commissionerate to conduct search and seizure, even though the jurisdictional ingredients were absent. Joint Commissioner (AE), Gautam Budh Nagar conveyed on 05.03.2021 to Delhi commissionerate to ascertain as to whether petitioner, which was the supplier of M/s Mridul Tobie Inc., was in existence or not. There was no independent application of mind by the Additional Commissioner, CGST Delhi North Commissionerate. The officers concerned should bear in mind that the search and seizure power conferred upon them is an intrusive power, which needs to be wielded with utmost care and caution. The legislature has, therefore, made this power by inserting the controlling provision, i.e., “reasons to believe”. The inspector used a prescribed form without taking the trouble of modifying having known that he was not the proper officer but someone who was authorised to act on behalf of the proper officer. The authorization accorded by the Additional Commissioner is legally untenable.
Held that:- The Hon’ble High Court declared the search and seizure conducted by CGST Delhi North Commissionerate as unlawful and set aside both the orders of seizure and prohibition dated 05.03.2021. Further, directed the respondent to release the documents at the earliest.
None of the ingredients which are prerequisites for the exercise of powers under Section 67(2) of the CGST Act, were present in instant case, accordingly the search and seizure conducted by CGST Delhi North Commissionerate are declared unlawful.
Section 67 of the CGST Act, 2017— Search and Seizure – The petitioner prayed for quashing the order of prohibition dated 05.03.2021, whereby goods have been detained; issuance of direction like a mandamus to the respondents to release the goods detained; to declare the search conducted as illegal. The petitioner is engaged in the business of trading in cigarettes which are supplied to it by authorised dealers of well-known manufacturing companies. Officers from a different Commissionerate CGST Commissionerate, Gautam Budh Nagar visited his premises on 05.03.2021 and searched the premises. An order of prohibition dated 05.03.2021 in Form GST INS – 03 by Inspector who is not a proper officer, was also passed. The petitioner submitted that there was no investigation pending before CGST Commissionerate and therefore, the search, seizure and authorization issued by respondent was unlawful. The court observed that Additional Commissioner, CGST Delhi North Commissionerate exercised his powers for authorizing staff of other commissionerate to conduct search and seizure, even though the jurisdictional ingredients were absent. Joint Commissioner (AE), Gautam Budh Nagar conveyed on 05.03.2021 to Delhi commissionerate to ascertain as to whether petitioner, which was the supplier of M/s Mridul Tobie Inc., was in existence or not. There was no independent application of mind by the Additional Commissioner, CGST Delhi North Commissionerate. The officers concerned should bear in mind that the search and seizure power conferred upon them is an intrusive power, which needs to be wielded with utmost care and caution. The legislature has, therefore, made this power by inserting the controlling provision, i.e., “reasons to believe”. The inspector used a prescribed form without taking the trouble of modifying having known that he was not the proper officer but someone who was authorised to act on behalf of the proper officer. The authorization accorded by the Additional Commissioner is legally untenable.
Held that:- The Hon’ble High Court declared the search and seizure conducted by CGST Delhi North Commissionerate as unlawful and set aside both the orders of seizure and prohibition dated 05.03.2021. Further, directed the respondent to release the documents at the earliest.