Cash seized during tax search: currency not "goods" u/s67 CGST, so seizure unlawful; return ordered with interest.

Cash/currency seized during search under s.67 CGST Act was held not to fall within "goods" because "money" is expressly excluded from the statutory definition; the Act contains no authority to forcibly take and retain currency from premises, rendering the resumption illegal and arbitrary, and the respondents were directed to return the amount. Independently, even assuming s.67 could apply, the statutory mandate under s.67(7) required return upon expiry of six months from seizure in the absence of a notice; since no notice was issued within that period, the petitioners became entitled to restitution, and the HC ordered immediate remittance of the fixed-deposit proceeds with interest to the person/entities from whose possession the cash was resumed.

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Issues Involved:
1. Legality of the resumption of currency as recorded in the Panchnama dated 04.10.2021.
2. The power of CGST Officers under Section 67(2) of the CGST Act to seize cash.
3. The interpretation of the term "things" under Section 67(2) of the CGST Act.
4. The requirement to return seized goods if no notice is issued within six months.

Summary of Judgment:

Issue 1: Legality of the Resumption of Currency
The petitioners sought directions to declare the resumption of currency recorded in the Panchnama dated 04.10.2021 as illegal, arbitrary, and contrary to the provisions of law. The petitioners also requested the return of the resumed currency totaling Rs. 1,90,66,000/-.

Issue 2: Power of CGST Officers to Seize Cash
The petitioners argued that CGST Officers had no power to seize cash under Section 67(2) of the CGST Act, as cash is excluded from the definition of "goods." The respondents contended that the cash was seized because the petitioner could not provide a satisfactory explanation for its possession, leading to a bona fide belief that the cash resulted from illegal activities.

Issue 3: Interpretation of "Things" Under Section 67(2)
The court examined whether the term "things" in Section 67(2) of the CGST Act includes money. The court referred to the Madhya Pradesh High Court's judgment in Kanishka Matta Vs. UOI, which included money under "things." However, the Kerala High Court in Shabu George Vs. State Tax Officer held that cash could not be seized under the GST Act, a view supported by the Supreme Court.

Issue 4: Requirement to Return Seized Goods
The court noted that under Section 67(7) of the CGST Act, if no notice is issued within six months of the seizure, the goods must be returned. The respondents had not issued any notice within this period, and therefore, the petitioners were entitled to the return of the resumed cash.

Conclusion:
The court concluded that the term "things" in Section 67(2) of the CGST Act does not include money, and thus, the seizure of cash was illegal and arbitrary. The court directed the respondents to remit the proceeds of the fixed deposit (along with interest) to the bank accounts of the entities/persons from whom the cash was resumed. The respondents were not precluded from taking further action under the law.

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