Interpretation of GST Prohibition Order Rule 139(4) under scrutiny by Gujarat HC

The Gujarat High Court considered the interpretation of provisions in the Central Goods and Services Tax Act regarding the issuance of a prohibition order under rule 139(4). The petitioner argued that the goods were properly accounted for and not secreted, challenging the prohibition order. The court issued a Notice returnable on 21st February, 2019, allowing direct service to certain respondents to ensure effective communication and adherence to legal procedures. The decision aimed to balance legal requirements while ensuring proper notification to all concerned parties.

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Issues involved: Interpretation of provisions of subsection (2) of section 67 of the Central Goods and Services Tax Act, 2017 in relation to the issuance of an order of prohibition under rule 139(4) of the rules.

In the judgment delivered by the Gujarat High Court, the learned advocate for the petitioner highlighted the provisions of subsection (2) of section 67 of the Central Goods and Services Tax Act, 2017. The advocate argued that for a search or seizure to be carried out, the concerned officer must have reasons to believe that goods liable to confiscation or relevant documents are secreted in a place. The petitioner contended that the goods in question were properly accounted for in the books and not secreted, making the prohibition order issued under rule 139(4) contrary to the Act. The court, after considering the submissions, issued a Notice returnable on 21st February, 2019.

The judgment also permitted direct service to respondents No.3 and 4, with the petitioner allowed to serve respondents No.1 and 2 directly through Speed Post at its own cost. This allowance for direct service aimed to ensure effective communication and adherence to legal procedures in the case. The court's decision reflects a balance between upholding legal requirements and facilitating proper notification to all concerned parties in the matter.

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