Statutory release of seized GST goods must follow the prescribed mechanism; writ directions cannot override the Act and Rules.

Section 67 of the CGST Act was treated as a complete code for inspection, seizure, provisional release, and disposal of seized goods, so writ courts should not bypass the statutory mechanism by directing release contrary to the Act and Rules. Provisional release must follow the prescribed conditions, including bond and security or payment of tax, interest, and penalty, and perishable or hazardous goods must be dealt with under the special statutory procedure. Orders inconsistent with this framework were not to be given effect, and the competent authority was required to process release claims afresh strictly in accordance with the statute.

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Issues: (i) Whether the High Court could grant release of seized goods in writ proceedings without requiring adherence to the statutory mechanism under the goods and services tax law. (ii) Whether the High Court orders directing release of seized goods contrary to the prescribed statutory procedure were liable to be disregarded and the pending writ petitions treated as disposed of in terms of the statutory framework.

Issue (i): Whether the High Court could grant release of seized goods in writ proceedings without requiring adherence to the statutory mechanism under the goods and services tax law.

Analysis: Section 67 of the Central Goods and Services Tax Act, 2017 provides a complete code for inspection, search, seizure, provisional release, and disposal of seized goods. Provisional release is contemplated only on execution of bond and furnishing of security, or on payment of applicable tax, interest, and penalty, while perishable or hazardous goods are governed by the specific procedure in the Act and the Rules. The statutory mechanism under Rules 140 and 141 reinforces that release and disposal must proceed in the manner prescribed by law, and the writ court ought not to bypass that framework by issuing inconsistent release directions.

Conclusion: The High Court ought to have relegated the assessees to the statutory procedure and should not have granted release directions inconsistent with the Act and the Rules.

Issue (ii): Whether the High Court orders directing release of seized goods contrary to the prescribed statutory procedure were liable to be disregarded and the pending writ petitions treated as disposed of in terms of the statutory framework.

Analysis: Orders of the High Court that departed from the express requirements of Section 67 and the relevant Rules were held not to be given effect to. The competent authority was directed to process the claims afresh strictly in accordance with the statutory provisions, and the pending writ petitions connected with the same issue were treated as covered by the common order to avoid inconsistent application of law.

Conclusion: The contrary High Court orders stood set aside or modified to the extent of inconsistency, and the matters were disposed of by directing fresh processing under the statutory regime.

Final Conclusion: The statutory procedure for release and disposal of seized goods under the goods and services tax law was held to be mandatory, and writ directions inconsistent with that procedure were not to operate.

Ratio Decidendi: Where a special statute provides a complete mechanism for provisional release and disposal of seized goods, the writ court should ordinarily require compliance with that mechanism and cannot issue directions that bypass or contradict the statutory scheme.

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