Search Authorisation Issued Without Having Any Reason to Believe is Invalid | Delhi HC

Case Details: Bhagat Ram Om Prakash Agro (P.) Ltd. v. Commissioner of Central Tax, GST - [2023] 154 taxmann.com 491 (Delhi)

Judiciary and Counsel Details

• • Vibhu Bakhru & Ms Tara Vitasta Ganju, JJ.
  • Avi Singh, Tanuj Bhadana & Ms Jyoti Babbar, Advs. for the Petitioner.
  • Harpreet Singh, Ms Suhani Mathur & Jatin Kumar Gaur, Advs. for the Respondent.

Facts of the Case

In this petition, the petitioners’ case was that search was conducted in view of directions issued by Special Judge (P.C. Act) to Income-tax Department, GST Department, and Enforcement Directorate to check source of Rs.50 lakhs received by petitioners. The petitioner alleged that the impugned search authorisation was illegal as same was issued without proper officer having any reason to believe that conditions as specified under Section 67(1) were complied with.

High Court Held

The Honorable High Court noted that we have serious reservations whether any such roving and fishing inquiry under the CGST Act, 2017 could have been directed to be conducted by the Special Judge. Further, the proper officer can authorise the search only if the conditions specified in Section 67 of CGST Act, 2017 are fulfilled.

Therefore, the Court directed to produce the relevant files containing the directions for conducting the search and also held that the proceedings pursuant to the search conducted would be stayed. The Court also issued notice to revenue and directed to file the counter affidavit within a period of two weeks.