2026-VIL-1167-RAJ
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SGST High Court Cases

GST - Power to seize cash under Section 67(2) of the CGST Act, 2017 - Cash was seized from the residential premises during search and the adjudicating authority held it to be sale proceeds of unaccounted goods sold without tax invoices, liable to confiscation under Section 130(1) - Petitioners contended that money is excluded from goods under Section 2(52) and cannot be seized as ‘things’ - Whether Section 67(2) authorises seizure of cash merely because it is suspected or later held to represent the proceeds of unaccounted taxable supplies - HELD – The writ petition challenging seizure of cash is maintainable despite pending statutory appeal and remedy under Section 112 - The power of seizure under Section 67(2) operates in respect of two distinct categories, namely goods liable to confiscation and documents or books or things useful or relevant to proceedings. Section 2(52) expressly excludes money from the definition of goods, and therefore cash cannot be goods liable to confiscation - The word ‘things’ must be read ejusdem generis with the associated words documents and books, which are evidentiary in character, and the second proviso permitting retention only for examination and inquiry confirms the evidentiary purpose - The Income-tax Act and the Customs Act expressly provide for seizure of money or currency, which shows that Parliament knows how to confer such power, and the omission in Section 67 cannot be judicially supplied. Powers of search and seizure are drastic powers and are not to be construed liberally - Even a prima facie case of tax evasion cannot enlarge the power of seizure beyond the limits enacted by Parliament. The reasons to believe must be based on objective material having a rational nexus with the statutory conditions and is not synonymous with mere suspicion - Cash that merely represents unaccounted wealth cannot be seized under Section 67, and retention towards a possible future recovery is not permitted - The seizure and retention of cash cannot be sustained, the Respondents are directed to release the amount to the persons from whose possession it was seized subject to any lawful order under an independently applicable statute, and the Petitioners are entitled to applicable interest – The writ petition is allowed
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