Goods sold which were seized by Department

[Rajesh Kumar]

Dear sir/madam,

Department conducted search and found stock at undeclared place or stock found without invoices. Now Department seized the said goods under INS-02 and handed over through INS-03 for safe custody.

Later on , party sold out these goods without informing Department and without release from Department.

Now what action can Department take against the party ?

AI Summary

Sale of seized goods: disposal without departmental release triggers tax recovery, monetary penalties and expanded enforcement.
Disposal of goods seized under the departmental search and seizure regime without departmental release constitutes a statutory lapse attracting recovery of tax with interest and monetary penalties. Issuing invoices or transacting in respect of goods not supplied and sold while under seizure can lead to proceedings against the supplier for improper invoicing and against any person who retains the benefit of the transaction, who may be liable to a penalty equivalent to the tax consequence. Compliance with written instructions on Form GST INS-02 and Form GST INS-03 is mandatory and breach exposes the taxpayer to expanded investigations and multiple enforcement measures.