2026-VIL-1053-GAU
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SGST High Court Cases

GST – Scope of expression ‘things’ contained in Section 67(2) of the CGST Act, 2017 - Seizure of currency during search and seizure operations - Officers seized cash during search and seizure operation - Whether the respondent authorities had jurisdiction or authority to seize cash or currency in the course of search and seizure under Section 67(2) of the CGST Act, 2017 - HELD - The expression ‘things’ in Section 67(2) of the CGST Act does not include cash or currency or money found or recovered during the course of search and seizure and the respondents did not have jurisdiction or authority to confiscate or retain cash or currency money during such process. The object of Section 67(2) is examination of documents and books for purposes of enquiry or proceedings under the Act and not to unearth unaccounted wealth nor to recover tax by seizing assets when separate mechanisms exist under Sections 73, 74, 78 and 79 of the CGST Act for that purpose and consequently any seizure or retention of cash or currency would be illegal and arbitrary and in clear contravention of the provisions of Section 67(2) of the CGST Act - The seizure of cash is held to be illegal and since the cash had been illegally withheld from the date of seizure till the date of refund, the petitioner would be entitled to interest accrued on the illegally withheld sum – The writ petition is disposed of - Retention of seized articles beyond the stage of issuance of show cause notice - Scope of powers under Section 67(3) - Officers retained two mobile phones, three pen drives and bank card even after issuance of show cause notice - Whether the respondent authorities were entitled to retain the seized articles after the show cause notice had been issued to the petitioner - HELD - With the issuance of the show cause notice, the necessity for retaining the goods or articles enumerated which included mobile phones, pen drives and bank card had ended as the investigation had been completed and culminated in the demand cum show cause notice and the articles could not be retained any further and were required to have been returned at least immediately after the show cause notice had been issued or served upon the petitioner as the provisions of Section 67(3) contemplate retention only for so long as may be necessary for examination and for enquiry or proceedings under the Act - The Investigating Officer shall forthwith arrange for return of the said articles to the petitioner.
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