Page 24 - GSTL_26th March 2020_Vol 34_Part 4

J120 GST LAW TIMES [ Vol. 34
Therefore, it is expected that the term ‘reason to believe’ is to be
taken in a deeper sense which means that the proper officer must
have something in hand to form an opinion as regards reasons to
believe by which he is duty-bound to search the premises or person.
The ‘reason to believe’ must be an honest belief based upon reason-
able grounds.
(ii) The documents or books or things seized can be retained only dur-
ing the pendency of enquiry or proceeding. Simultaneously, no re-
lied upon documents shall be returned within a period of 30 days of
the issuance of notice.
(iii) Though the proper officer has power to seal or break open the door
or the almirah or the electronic devices, but this power can be exer-
cised only if access to the premises is denied to the proper officer.
Meaning thereby that the premises cannot be sealed or broken if the
access is being given to the proper officer.
(iv) Section 67(5) of the CGST Act, 2017, safeguards the interests of the
taxable persons/any person whose premises is searched and makes
provisions that he is entitled to make copies of the documents
which are seized under this section.
(v) Of course, the goods, if seized, are to be released provisionally by
execution of a bond and furnishing of adequate security.
(vi) Like Central Excise law, the notice in respect of seized goods is to be
given within 6 months of such seizure, else the goods shall have to
be returned back to the person from whose possession they were
seized.
(vii) The inventory of the seized goods or documents is to be prepared.
The power given in the Section 67 of the CGST Act, 2017, is sometimes misutilized
or exceeded by the proper officer and the Hon’ble Courts have always deprecated
such excessive action by the authorities. The Hon’ble High Court of Gujarat at
Ahmedabad in Paresh Nathalal Chauhan v. State of Gujarat [2020 (32) G.S.T.L. 342
(Guj.)], while examining the ambit and scope of provisions contained in Section 67
of the CGST Act, 2017, observed as follows :
“The entire exercise carried out by the concerned officers from 12-10-2019 to
18-10-2019 was totally without any authority of law and in flagrant disregard
of the provisions of the Act and the rules and in total abuse of the powers
vested in them under the Act. The manner in which the officers have con-
ducted themselves by overreaching the process of law and acting beyond the
powers vested in them under sub-section (2) of Section 67 of the CGST Act
needs to be deprecated in the strictest terms.”
It was further held that :
“… A proper enquiry needs to be made in respect of the action of the Re-
spondent officers of staying day and night at the premises of the petitioner
without any authority of law.”
Needless to say, any power conferred in the statute cannot be absolute. Along with
the power, there is a corresponding sense of responsibility/duty and the statutory
powers must be exercised cautiously so that the belief in “Rule of Law” stays in-
tact.
_______
GST LAW TIMES  26th March 2020  120