Search and seizure power conferred upon the officers is an intrusive power, which needs to be wielded with utmost care and caution.

Case Details:

Issue- In the above case, petitioner obtained GST registration on 20.09.2020. Petitioner was engaged in the business of trading of cigarettes and tobacco products. Petitioner filed timely returns and also paid proper tax liabilities as required by statute. That on 13.02.2021 the officers of DGGI Ahmedabad visited its premises located in delhi backed by an authorization issued by Joint Director, DGGI (AZU) dated 12-2-2021 under section 67(2) of the CGST Act. The team which visited Petitioner’s premises also comprised various officers attached to DGGI Delhi Zonal Unit (DZU) including Inspector, CGST South Commissionerate Delhi, South Delhi. Since on the day of visit, premises was found locked , the same was sealed. On 14-02-2021, the officers again visited the premises and de sealed the premises and some documents were seized under INS-02. On the same day i.e. 14-02-2021, summons were issued to give evidence, for production of documents. Petitioner contented that on 05-03-2021, Another set of officers from a different Commissionerate i.e. CGST Commissionerate, Gautam Budh Nagar paid a visit to its registered premises for, conducting a search with the authorisation for carrying out the search issued by Additional Commissioner, CGST Delhi North Commissionerate where cigarettes packed in 190 corrugated boxes were detained and summons were issued to both partners of petitioner  to tender statement.

Held- It was held that before the proper officer not below the rank of Joint Commissioner decides to either conduct the search and seizure himself or authorize another person in writing to do the same, he should have, reasons to believe, that “any” goods are liable to be confiscated or “any” documents or books or things which, in his opinion, are useful or relevant to any proceedings under the CGST Act, are secreted in “any” place but in this case, the search and seizure was conducted by an Inspector of the CGST Delhi North Commissionerate based on the authorization of the Additional Commissioner of the same department i.e. CGST Delhi North Commissionerate. Admittedly, in the instant case, no investigations were carried out against petitioner by the CGST Delhi North Commissionerate. The authorization, as noticed above, (and qua which there is no dispute) was based on the communication dated 5-3-2021 addressed by Joint Commissioner (AE), Gautam Budh Nagar to the Additional/Joint Commissioner, CGST Delhi North Commissionerate and after careful perusal of this communication would show (something that we have noticed hereinabove) that the Joint Commissioner (AE), Gautam Budh Nagar wanted to know, in connection with the investigation of an entity going by the name M/s Mridul Tobie Inc., as to whether Petitioner, which was its L2 category supplier, actually existed or not. There was nothing stated in the document which could have formed the basis for issuing an authorization of even date by the Additional Commissioner CGST Delhi North Commissionerate and therefore, for the exercise of powers concerning search and seizure, we are of the opinion that the Additional Commissioner, CGST Delhi North Commissionerate exercised his powers for according authorization to conduct search and seizure, at petitioner’s premises, even though the jurisdictional ingredients were absent. There was no independent application of mind by the Additional Commissioner, CGST Delhi North Commissionerate. Accordingly, the search and seizure conducted by CGST Delhi North Commissionerate are declared unlawful. Consequently, both the orders of seizure and prohibition dated 5-3-2021 were set aside. The subject documents will be released to petitioner, at the earliest. Liberty is, however, given to the concerned officer to retain copies of the same in case they are required for carrying out further investigations against petitioner.