GST officers cannot seize silver bars, currency, and valuables from homes under Section 67 without proper authority

The Delhi HC ruled that proper officers lacked authority under Section 67 of the GST Act to seize silver bars, currency, and mobile phones from petitioner's residential premises. The court held that silver bars constitute "goods" under GST Act rather than "securities," and Section 67 does not permit seizure of currency or valuable assets merely because they represent unaccounted wealth. The court emphasized that search and seizure powers are drastic and should not be construed liberally, and the GST Act's purpose is not to proceed against unaccounted wealth. The court directed immediate release of all seized currency and valuable assets, allowing the petition.

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Issues Involved:
1. Legality of the search and seizure of silver bars, Indian currency, and mobile phones.
2. Authority of the proper officer under Section 67 of the Central Goods and Services Tax Act, 2017 (the Act) to seize currency and other valuable assets.
3. Requirement to issue notice within six months of seizure and its implications.
4. Interpretation of the term "goods" and "things" under the Act.

Summary:

Issue 1: Legality of the Search and Seizure
The petitioner requested the release of two silver bars, Rs. 7,00,000/- Indian currency, and mobile phones seized from his residence, arguing the search and seizure were illegal. The petitioner was arrested on 29.01.2020 for alleged offenses under Section 132(1)(i) of the Act and released on bail on 21.03.2020. The petitioner contended that no reliance was placed on the seized items in the notice issued under Section 74 of the Act, and thus, the seized goods should be restored.

Issue 2: Authority Under Section 67
The petitioner argued that currency is not "goods" as defined under the Act and thus cannot be seized. The proper officer's power to seize under Section 67(2) is limited to goods liable for confiscation and documents or things useful for proceedings under the Act. The court examined Section 67 and concluded that the power to seize cash or other assets is not for securing revenue interests but for aiding proceedings against tax evasion.

Issue 3: Requirement to Issue Notice
The court noted that under Section 67(7), if no notice is issued within six months of the seizure, the goods must be returned. The petitioner argued that no notice was issued within the stipulated period, making the seized goods liable for release. The court agreed, stating that the seized items were not relied upon in any subsequent notice, thus requiring their return.

Issue 4: Interpretation of "Goods" and "Things"
The court clarified that "goods" under Section 2(52) of the Act exclude money and securities, and silver bars do not qualify as securities. The term "things" in Section 67(2) must be read ejusdem generis with "documents" and "books," implying items containing information useful for proceedings under the Act. The court rejected the expansive interpretation of "things" to include currency and valuable assets without evidentiary value.

Conclusion:
The court directed the respondents to release the seized currency and valuable assets, emphasizing that the purpose of Section 67 is to unearth tax evasion, not to secure unaccounted wealth. The court also noted that the respondents could continue other proceedings under the Act as per the law.

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