Heard counsel for petitioners and Sri K.M.Natraj, Additional Solicitor General appearing for respondents.
In all these Writ Petitions, the constitutional validity of Sections 67(10), 69(1), 70, 132(5) and 135 of the Central Goods and Service Tax Act, 2017 (for short `the Act’) is challenged.
However, the main contention being raised by the petitioners is that power of arrest under Section 69(1) of the Act can be exercised only after completion of the assessment in accordance with the provisions of the Act and on raising of a demand on the petitioners, and only if it is found necessary to arrest the person having regard to his failure to comply with the summons issued by the CGST authorities.
This point was raised by the petitioners in W.P.No.10350 of 2019 and others in W.P.No. 5130 of 2019 and batch before this Court and a Division Bench of this Court had dismissed the said Writ Petitions declaring as under in paras 52 and 61 there of:
“52. But, to say that a prosecution can be launched only after the completion of the assessment, goes contrary to Section 132 of the CGST Act, 2017. The list of offences included in sub-Section (1) of Section 132 of CGST Act, 2017 have no co-relation to assessment. Issue of invoices or bills without supply of goods and the availing of ITC by using such invoices or bills, are made offences under clauses taxguru.in (b) and (c) of sub-Section (1) of Section 132 of the CGST Act. The prosecutions for these offences do not depend upon the completion of assessment. Therefore, the argument that there cannot be an arrest even before adjudication or assessment, does not appeal to us.
61. In view of the above, despite our finding that the writ petitions are maintainable and despite our finding that the protection under Sections 41 and 41-A of Cr.P.C., may be available to persons said to have committed cognizable and non-bailable offences under this Act and despite our finding that there are incongruities within Section 69 and between Sections 69 and 132 of the CGST Act, 2017, we do not wish to grant relief to the petitioners against arrest, in view of the special circumstances which we have indicated above.”
These orders were challenged by the petitioners therein in Special Leave to Appeal (Crl.) No.4430 of 2019 and Batch before the Supreme Court and on 27.05.2019, a Bench presided over by the Hon’ble the Chief Justice of India dismissed the said Special Leave Petitions.
Therefore, when the very arrest of the petitioners is not prohibited prior to the completion of the assessment, any coercive action lesser than arrest, can not also be said to be prohibited.
Accordingly, the interim order granted on 15.05.2019 in W.P.No. 10350 of 2019 is vacated.
Since the petitioners in W.P.Nos. 10351 of 2019 and 10354 of 2019 stand on the same footing as the petitioners in W.P.No.10350 of 2019, the interim order obtained by the petitioners in W.P.Nos. 10351 of 2019 and 10354 of 2019 on 15.05.2019 on 15-05-2019 cannot also stand, and they are also accordingly vacated.
Arrest or any coercive action lesser than arrest before GST Assessment not prohibited