" Search cannot be conducted until all the conditions u/s 67 of the CGST Act are fulfilled
"
The Hon’ble Delhi High Court in the case of M/s. Bhagat Ram Om Prakash Private Limited & Anr. v. The Commissioner Central Tax GST Delhi-East [W.P. (C) 12304/2023 dated September 19, 2023]
stayed the proceedings pursuant to the search, conducted on the basis of the directions issued by the Special Judge, for checking the source of amount, and directed the proper officer to authorized the search only if all the conditions specified under Section 67 of the Central Goods and Service Tax Act, 2017 (“the CGST Act”) are fulfilled.
Facts:
M/s. Bhagat Ram Om Prakash Private Limited and other related parties (“the Petitioners”) have purchased a property from Mr. Rajesh Kumar Anand for a sum of Rs. 50,00,000/- which was later on deposited in a fixed deposit and then was offered as collateral for securing the bail.
The Petitioners contended that the search authorization issued by the proper officer (“the Respondent”) on August 22, 2023 was illegal as it was issued without determining the conditions specified under Section 67(1) of the CGST Act.
Further, the Petitioners contended that the search was conducted under the directions of the Special Judge to various departments to check the source Rs.50,00,000/- received by the Petitioners.
Aggrieved by the search authorization, petitioners have filed this writ petition before the Hon’ble Delhi High Court.
Held:
The Hon’ble Delhi High Court in W.P. (C) 12304/2023, held as under:
Observed that, there are serious reservations about whether any such roving and fishing inquiry under the CGST Act could have been directed to be conducted by the Special Judge.
Opined that, the respondent is authorized to conduct a search only if the conditions specified in Section 67 of the CGST Act are satisfied.
Directed that, the Respondent shall also produce the relevant files containing the directions for conducting the search.
Posted on: 09/10/2022
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