Rimjhim Ispat Limited Vs State Of U.P. (Allahabad High Court)
Points that emerge for adjudication are whether the search and seizure under GST was carried out by observing the ‘substantive due process’ as well as the ‘procedural due process.’
As regards the substantive due process, which has to be followed before any search, can be carried out, is contained under sections 67(1) and 67(2) of the U.P. GST Act and prior to exercise of the said powers, it is essential that the officer authorizing the search should have ‘reasons to believe.’ The principles that are culled out from the catena of decisions referred above is that the ‘reasons to believe’ should exist and should be based on reasonable material and should not be fanciful or arbitrary. It is also established that this Court in exercise of its powers under Article 226 cannot go into the sufficiency of the reasons and should not sit as an appellate court over the reasons recorded. It is also well established that the reasons may or may not be communicated to the assessee but the same should exist on record.
Sri C.B. Tripathi, learned counsel for the respondent, during the course of arguments, had placed before us the part of the records wherein the officers concerned had recorded their ‘reasons to believe’ prior to authorizing the search, the ‘reasons to believe’ were based upon information received by the Department fortified by interception of the goods of the petitioner on 11.3.2018 wherein the e-way bill was found to be suspicious and it is based upon this perception a reason to believe was formed by the Department which led to the search on 13.3.2018.
