2025 (8) TMI 400 - HC - GST

Detention Declared Illegal Under Relevant Law, Immediate Release Ordered, GST Intelligence Directed to Cooperate Fully

The HC declared the detention of the petitioner illegal, relying on precedents from the SC and various HCs. The court directed the immediate release of ... Recovery of husband of petitioner from the illegal custody of respondents No. 2 and 3 and to hand him over to the petitioner and his family members or in alternative, appoint a Warrant for this purpose - HELD THAT:- This Court finds it appropriate to accept the explanation provided in the said affidavit. However, it is expected that such a conduct will not be repeated and that the Directorate General, Goods & Service Tax Intelligence will fully cooperate with any Court appointed officers, should such a situation presents itself in the future. Furthermore, a detailed order was passed by this Court on 18.07.2025 wherein relying upon the judgments rendered by the Hon’ble Supreme Court in Radhika Agarwal vs. Union of India and another, [2025 (2) TMI 1162 - SUPREME COURT (LB)], a Division bench of the Bombay High Court in Mahesh Devchand Gala vs. Union Of India of India and others [2024 (9) TMI 1785 - BOMBAY HIGH COURT] and a Division bench of the Telangana High Court in Agarwal Foundries Private Limited Rama Towers and others vs. Union of India and others, [2020 (11) TMI 269 - TELANGANA HIGH COURT], the arrest of the detenue-Bharat Lal Goyal was declared illegal. The jail authorities are directed to release the petitioner forthwith, if not required in any other case - Petition allowed. ISSUES: Whether the detention and arrest of the individual by the Directorate General of Goods and Service Tax Intelligence (DGGI) officials was lawful and complied with constitutional protections under Articles 21 and 22.Whether the arrest authorization under Section 69 of the CGST Act complied with statutory requirements, including issuance of a valid Document Identification Number (DIN) as mandated by the Central Board of Indirect Taxes & Customs.Whether the recording of statements by DGGI officials complied with judicial precedents regarding timing, presence of counsel, and CCTV surveillance.Whether the failure to produce arrest records and related documents before the Court affected the legality of the arrest and detention.Whether the conduct of DGGI officials in keeping the detenue in custody overnight without a cognizable offence was justified.Whether the directions issued by the Hon'ble Supreme Court in Paramvir Singh Saini vs. Baljit Singh and others (2021) were followed in letter and spirit by the DGGI officials. RULINGS / HOLDINGS: The arrest and detention of the individual were declared illegal as the detenue was kept in custody for over 30 hours without a prima facie cognizable offence, violating protections under Articles 21 and 22 of the Constitution; the Court emphasized that 'the detenue was not free agent while he was remained in the zonal office overnight.'The Court held that the authorization for arrest under Section 69 of the CGST Act was 'mechanical in nature and does not reflect application of mind,' and the failure to produce a valid DIN as required by Circular No. 128/47/2019-GST rendered the arrest vitiated by 'incurable illegality.'The recording of statements must occur during office hours under CCTV surveillance, with the person summoned entitled to have their counsel present within their field of vision but outside hearing range, consistent with judicial precedents; any statement recorded overnight was only valid if made with consent and was not retracted.The non-production of arrest records and documents before the Court was due to 'circumstances beyond the control' of the deponent, with an unconditional apology tendered; however, the absence of such records at the material time undermined the procedural propriety of the arrest process.The DGGI officials' argument that their proceedings under Section 70 of the CGST Act are judicial and not subject to Cr.P.C. provisions was rejected insofar as it failed to justify prolonged detention beyond office hours without cogent reasons.The Court accepted the affidavit explanation regarding CCTV camera functionality and procedural improvements but expected strict adherence to the Supreme Court's directions in Paramvir Singh Saini to avoid future violations. RATIONALE: The Court applied constitutional safeguards under Articles 21 and 22, emphasizing the right to liberty and procedural fairness in arrests and detentions.Reliance was placed on Supreme Court precedents, including Paramvir Singh Saini vs. Baljit Singh & Others, Radhika Agarwal vs. Union of India, and Arvind Kejriwal, which delineate the standards for lawful arrest, recording of statements, and the necessity of compliance with procedural safeguards such as presence of counsel and CCTV recording.The Court also relied on decisions of High Courts (Bombay and Telangana) that mandate recording statements during office hours and under surveillance to prevent coercion or abuse.The statutory framework under the CGST Act, specifically Section 69 and the related Circulars issued by the Central Board of Indirect Taxes & Customs, was critically examined to ensure compliance with formalities such as issuance of DIN, which ensures traceability and validity of arrest authorizations.The Court identified a doctrinal shift emphasizing that DGGI officials, despite characterizing their proceedings as judicial, must adhere to constitutional protections akin to those applicable to police officials when restricting personal liberty.The Court underscored the principle that mechanical or ipse dixit authorizations without application of mind and failure to produce records undermine the rule of law and vitiate the legality of arrests.The acceptance of the affidavit's explanation regarding CCTV camera functionality was coupled with a clear expectation of full future compliance, reflecting a balance between procedural leniency and strict enforcement of safeguards.