As per section 67(2) of CGST Act 2017, an officer, not below the rank of Joint Commissioner may authorize (in writing ) any officer or may himself conduct search and seizer of goods, documents or books or things if he has reason to believe (either pursuant to an inspection carried out or otherwise ) that goods, documents, books and things are secreted in any place.

The Jt. Commissioner may conduct/authorize to conduct search & seizure if he is of opinion that these goods are liable to confiscation and documents books & things shall be useful for or relevant to any proceedings under this Act.

The Expression ‘things’ occurring in section 67(2) would cover cash also and GST Authority is empowered to seize cash from assessee under the said section.

It is held by Hon’ble Madhya Pradesh High Court in the case of Kanishka-Matta-Vs-Union-of-India that GST Authorities have the power to seize cash from the assessee and the expression ‘things’ cover cash also under section 67(2) of CGST Act 2017.

Brief Facts of the Case A search was conducted at business places and residential places of the husband of the petitioner and a Panchnama was drawn on 31/05/2020.

The Goods comprising of Pan Masala, Tobacco, Mouth Freshener, Confectionery, etc. valued at Rs. 2.59 Crores were seized under section 67(2) of the CGST Act read with Section 129 of the CGST Act and Section 130 of the CGST Act from six godowns operated by the petitioner’s husband as no bills/invoices could be produced by them. The Authorities have also seized unaccounted cash to the tune of Rs. 66 Lakhs from the residential premises as per the Panchnama prepared by them.

Petitioner’s Contention The petitioner contends that the word “money” is not included in section 67(2) of the CGST Act, 2017 and therefore, once the “money” is not included under section 67(2) of the CGST Act, 2017 the Investigating Agency/Department is not competent to seize the same.

It is stated that the cash cannot be treated as “Document, Book or Things” as per the definition under the definition clause of the CGST Act, 2017 and therefore, the respondents be directed to release the cash, which they have seized.

The basic thrust is on the ground that without there being any provision under the CGST Act, 2017 the amount as seized by the respondents could not have been done and the same is violative of Article 14 of the Constitution of India. Another ground raised by the petitioner that the raid on the residential premises of petitioner and her husband is again violative of Article 19 and finally a prayer has been made to release the seized cash/sale proceeds to the tune of Rs. 66,43,130/-.

A rejoinder has been filed in the matter and the stand of the petitioner is that by no stretch of imagination section 67(2) of the GST Act, 2017 empowers the respondents to seize the cash the respondents should release the cash forthwith.

Respondent’s Submission   The respondent has submitted  that keeping in view section 67(2) of the CGST Act, 2017 read with the definition clause makes it very clear that he was justified in seizing the amount from the petitioner and the statute empowers them to do so. The respondent has also submitted the Case Diary in a sealed cover before this Court.

TEXT OF THE HIGH COURT ORDER /JUDGEMENT:- It is stated by the Hon’ble  Madhya Pradesh High Court that the core issue before this Court is, whether the expression “things” covers within its meaning the cash or not.

In the considered opinion of this Court, the CGST Act, 2017 has to be seen as a whole and the definition clauses are the keys to unlock the intent and purpose of the various sections and expressions used therein, where the said provisions are put to implementation.

Section 2(17) defines “business” and section 2(31) defines “consideration”. In the considered opinion of this Court a conjoint reading of section 2(17), 2(31), 2(75), and 67(2) makes it clear that money can also be seized by an authorized officer.

This Court has carefully gone through section 67 of the CGST Act, 2017 and the expression used in sub-section (2) of section 67 is “confiscation of any documents or books or things, which in proper officer’s opinion shall be useful for or relevant to any proceedings under this Act, are secreted in any place”. Thereafter, sub-section (2) has two provisos and the first proviso relates to goods and the second proviso refers to documents or books or things so seized shall be retained.

Therefore, keeping in view the aforesaid interpretation of the word “thing” money has to be included and it cannot be excluded as prayed by the petitioner from section 67(2). The present case is at the stage of search and seizure. A search has been carried out and proceedings are going on.

The Court is of the opinion that the authorities have rightly seized the amount from the husband of the petitioner and unless and until the investigation is carried out and the matter is finally adjudicated, the question of releasing the amount does not arise. The writ petition is dismissed

The Author can be approached at caanitabhadra@gmail.com

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