Bharatkumar Pravinkumar And Co. Vs State of Gujarat (Gujarat High Court)
In a recent judgment, the Gujarat High Court addressed the issue of the seizure of cash under the Goods and Services Tax (GST) Act in the case of M/s. Bharatkumar Pravinkumar and Co. v. State of Gujarat [Special Civil Application No. 26222 of 2022 dated October 26, 2023]. The court’s decision sheds light on the interpretation of relevant provisions and their implications for taxpayers.
Hon’ble Gujarat High Court allowed the writ petition and held that cash would not be considered as goods for the purpose of seizure proceedings, and it is not justified to retain cash seized by the Revenue Department for more than six months, without issuance of Show Cause Notice (SCN).
Facts:
M/s. Bharatkumar Pravinkumar and Co. (“the Petitioner”) is a partnership firm engaged in the business of courier services. Silver bars of the Petitioner were seized in the year 2004 by the Income Tax Department. The silver bars were not released even after payment of taxes due. Therefore, the Petitioner moved a Special Civil Application before the Hon’ble Gujarat High Court and the Court issued orders for release of silver bars in question.
The Petitioner sold the silver bars and the amount of sale proceeds received by the Petitioner through cheque. The amount received from the sale of silver bars, was withdrawn by the Petitioner. Thereafter, the Revenue Department (“the Respondent”) seized the cash while the cash was being transferred to the branch office of the Petitioner vide order dated November 13, 2020. The Petitioner further made a representation for the release of cash which is pending for adjudication.
Aggrieved, the Petitioner filed a writ application for the release of cash on the ground that the cash seized would not amount to the subject matter of seizure as the cash seized is neither goods, documents or things, under the framework of the Act. It was further stated that, the cash can be seized only in cases where seizure of cash is useful or relevant for proceeding under the act. Therefore, in the present case, cash cannot be seized under the provisions of Section 67 of the Central Goods and Services Tax Act, 2017 (“the CGST Act”) as it is also not shown as stock in trade of Assessee.
Issue:
Whether cash can be considered as goods for the purpose of seizure proceedings under GST?
Held:
The Hon’ble Gujarat High Court in the case of Special Civil Application No. 26222 of 2022 held as under:
