TaxTMI 
TaxTMI 
2026 (2) TMI 463
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....self as an Office Boy in M/s Kabsan Services Private Limited, is seeking declaration about his arrest by present respondent No. 4 in Case No.1/2025, as null and void. He has also prayed for quashing and setting aside the order dated 21.06.2025 passed by the learned Judicial Magistrate (First Class), Nanded granting his magisterial custody. Consequently, the petitioner has sought direction to respondent No. 4 to give him compensation of Rs. 10,00,000/- (Rupees Ten Lakh) towards his illegal arrest. 3. Chronology of the events and background facts as claimed by the petitioner, can be summarised as under : On 17.06.2025 around 1.00 p.m. GST Officers visited office of one Chartered Accountant Bhavik Bhanushali (Mehta) at Mumbai. Thereafter the petitioner was telephonically called there and taken into custody by these GST Officers without any summons or arrest memo on the same day. Thereafter he was taken out of Mumbai to Chhatrapati Sambhajinagar without informing his family members. On 18.06.2025 the petitioner was brought and illegally detained at CGST and Central Excise Office, GST Bhavan, Chhatrapati Sambhajinagar. He was kept there in the custody without showing any arr....
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....s such, the only prayer remains in this petition is in respect of grant of compensation of Rs. 10,00,000/- on account of alleged illegal arrest of the petitioner. Learned counsel for the petitioner vehemently argued that respondent No. 4 Mr. Nade was not having jurisdiction to issue summons to the petitioner at Mumbai and the summons to the petitioner issued on 17.06.2025 was therefore without jurisdiction and prepared as false and fabricated document. According to him, CA Bhavik was called at 9.00 p.m. on 17.06.2025 at the office of Ankit Dharod without any summons and concocted story was prepared for facilitating illegal detention of the petitioner. Learned counsel for the petitioner submits that fabricated record of summons was prepared after the petitioner was taken into custody and that too after getting mail from his advocate. Learned counsel for the petitioner further submitted that in fact 7 days notice was required for issuing summons as per order XVI of the Code of Civil Procedure since there is no specific provision about the duration mentioned in Section 70 of the CGST Act. According to him, there was violation of guidelines issued by higher authorities of the respon....
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.... the petitioner as well as learned Counsel Mr. Talhar, we have gone through the documents placed on record and also the material placed on record in the light of observations of the citations relied by the rival parties and the concerned legal provisions. 8. As observed earlier, it is to be noted that now only one prayer in this petition is remained for consideration, since the learned counsel for the petitioner waived prayer clauses (B) and (c) for declaring the arrest of the petitioner as well as order of granting him magisterial custody, as null and void. The petitioner is now claiming compensation of Rs. 10,00,000/- for his illegal detention at the hands of the respondents by alleging that he was taken in custody from 17.06.2025 to 20.06.2025, but his arrest was shown on 21.06.2025. On the contrary, respondent Nos. 1 to 4 are claiming that the petitioner was not in fact arrested, but to ascertain the fraudulent utilization of Input Tax Credit by the Kapson Company registered at Nanded of which the petitioner was found to be In-charge of, they had summoned the petitioner as well as other persons namely Chartered Accountant Ankit Dharod and his consultant Bhavik Mehta for reco....
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.... for further inquiry. Thereafter on 19.06.2025 also the petitioner was called for inquiry on 20.06.2025. It is to be noted that the petitioner did not raise any objection for such attendance during period from 17.06.2025 to 20.06.2025. Thereafter on ascertaining the involvement of the petitioner he was arrested on 21.06.2025 and without any delay, produced concerned Magistrate, who granted him custody. 11. Learned counsel for the petitioner vehemently argued that there should have been 7 days notice prior to fixing the date for inquiry in view of Section 70 of CGST Act, but there was clear-cut violation at the hands of respondent No. 4 while issuing said summons by not giving time gap of 7 days. For that purpose he drew our attention to the concerned Section 70 of CGST Act, which reads thus : "(1) The proper officer under this Act shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry in the same manner, as provided in the case of a civil court under the provisions of the Code of Civil Procedure, 1908 (5 of 1908). (1-A) All persons summoned under sub-sectio....
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....o the petitioner in respect of inquiry, and therefore, when the Section is silent in respect of 7 days notice, we are unable to understand that there should be 7 days notice required for such inquiry. 12. Though in the case of FSM Education Pvt. Ltd vs Union of India (supra) this Court had held that if any summons is required to be issued by the respondent, then it shall indicate the purpose of issuance of summoned with clear 7 days notice, however, this observation had come in the peculiar circumstances of that case only and this cannot be made directly applicable in the instant matter, considering the mandate of Section 70 of CGST Act. It is to be noted that in the case of Radhika Agarwal vs Union of India (supra), the Hon'ble Apex Court has held thus: "69. However, we may clarify that a person summoned under Section 70 of the GST Acts is not per se an accused protected under Article 20(3) of the Constitution, as has been held in the case of Deepak Mahajan (supra). This is because the prohibitive sweep of Article 20(3) of the Constitution does not go back to the stage of interrogation. Reference in this regard has been placed on Poolpandi and Others v. Superintendent,....
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....fect from the date recommended by the Goods and Services Tax Council." 75. The Parliament, under Article 246-A of the Constitution, has the power to make laws regarding GST and, as a necessary corollary, enact provisions against tax evasion. Article 246-A of the Constitution is a comprehensive provision and the doctrine of pith and substance applies. The impugned provisions lay down the power to summon and arrest, powers necessary for the effective levy and collection of GST. Time and again this Court has held that while deciding the issue of legislative competence, entries should not be read in a narrow or pedantic sense but given their broadest meaning and the widest amplitude because they are intrinsic to a machinery of government.58 The ambit of an entry or article laying down the legislative field extends to all ancillary and subsidiary matters which fairly and reasonably can be said to be comprehended in it.59 This settled dictum regarding the interpretation of legislative entries equally applies to the special provision of Article 246-A of the Constitution. In the context of the legislative power to levy and collect tax, a Constitution Bench of Seven Judges in R.S. ....
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.... 87. However, when the legality of such an arrest made under the Special Acts like PMLA, UAPA, Foreign Exchange, Customs Act, GST Acts, etc. is challenged, the Court should be extremely loath in exercising its power of judicial review. In such cases, the exercise of the power should be confined only to see whether the statutory and constitutional safeguards are properly complied with or not, namely to ascertain whether the officer was an authorized officer under the Act, whether the reason to believe that the person was guilty of the offence under the Act, was based on the "material" in possession of the authorized officer or not, and whether the arrestee was informed about the grounds of arrest as soon as may be after the arrest was made. Sufficiency or adequacy of material on the basis of which the belief is formed by the officer, or the correctness of the facts on the basis of which such belief is formed to arrest the person, could not be a matter of judicial review". 13. Therefore, on going through the aforesaid observations as well as language of Section 70 of CGST Act, it cannot be held that there was need of 7 days notice for issuing summons under Section 70 of the CGST ....