Recorded reasons support GST search and seizure, but ex parte confiscation without hearing was quashed and remanded.

Recorded reasons to believe based on relevant material are sufficient to support search and seizure under the Uttar Pradesh GST Act, and writ review will not test the adequacy of that material once reasons are on record; the challenge to the search therefore failed. A confiscation order under section 130, however, must be preceded by a meaningful hearing, and an ex parte order passed without that opportunity could not be sustained; the order was quashed and remanded for fresh adjudication after hearing the taxpayer.

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Issues: (i) Whether the search and seizure under the Uttar Pradesh Goods and Services Tax Act, 2017 was invalid for want of recorded reasons to believe and for alleged mala fides or procedural irregularity; (ii) Whether the confiscation order passed under section 130 of the Uttar Pradesh Goods and Services Tax Act, 2017 could be sustained when passed ex parte without adequate hearing.

Issue (i): Whether the search and seizure under the Uttar Pradesh Goods and Services Tax Act, 2017 was invalid for want of recorded reasons to believe and for alleged mala fides or procedural irregularity.

Analysis: The power of search and seizure under section 67 is conditioned on the existence of reasons to believe based on relevant material. The recorded material placed before the Court showed departmental information and circumstances including interception of goods on 11.03.2018. In judicial review, the Court does not test the sufficiency or adequacy of that material once reasons exist on record. Allegations regarding the manner of search, overwriting, witnesses, and non-weighment were not established by cogent evidence so as to show illegality or mala fides.

Conclusion: The challenge to the search and seizure failed and the action was upheld.

Issue (ii): Whether the confiscation order passed under section 130 of the Uttar Pradesh Goods and Services Tax Act, 2017 could be sustained when passed ex parte without adequate hearing.

Analysis: Section 130 contemplates confiscation of goods, and sub-section (4) mandates a hearing before the final order. The impugned confiscation order was passed ex parte after the petitioner sought deferment of adjudication pending the writ proceedings. In these circumstances, the order could not be sustained as passed, and the matter required reconsideration after hearing the petitioner.

Conclusion: The confiscation order was quashed and the matter was remanded for fresh adjudication after affording opportunity of hearing.

Final Conclusion: The Court sustained the search and seizure, but interfered with the confiscation order for violation of the hearing requirement and directed fresh consideration in accordance with law.

Ratio Decidendi: Where recorded reasons to believe exist on relevant material, the Court in writ jurisdiction will not examine their sufficiency, but a confiscation order under the GST law must be preceded by a meaningful opportunity of hearing and may be set aside if passed ex parte in breach of that mandate.

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