TaxTMI 
TaxTMI 
2026 (2) TMI 893
X X X X Extracts X X X X
X X X X Extracts X X X X
....us/petitioner while declaring the detention, arrest, and subsequent remand and custody of the petitioner as unconstitutional, illegal and arbitrary and consequently directing that the Petitioner be released forthwith; ii. to issue a writ, order, or direction in the nature of certiorari setting aside the order dated 17.01.2026 passed by the Chief Judicial Magistrate, Meerut, in Case No. 1361/2025, under Section 132(1)(c) of the CGST Act, 2017, Department DGGI, Ghaziabad, and all consequential proceedings thereof; iii. to issue any other and further writ, order, or direction, which this Hon'ble Court may deem fit and proper in the facts and circumstances of the case. iv. To allow the instant petition with costs. 3. The brief facts of the case is that on 29.12.2025 at about 8:00 a.m., officers of respondent no.1 detained the petitioner and started search proceedings at his residential premises as per Section 67 of CGST Act. After the search proceedings under Section under Section 67 of the CGST Act, petitioner was arrested on 16.1.2026 as per Section 69 of the Act aforesaid. 4. Learned Senior Counsel for the petitioners submits that at about 6:40 p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d with the investigation we fail to appreciate why there should be a compulsion on the officer to arrest the accused." Conditions precedent to arrest: 3.1 Sub-section (1) of Section 132 of CGST Act, 2017 deals with the punishment for offences specified therein. Sub-section (1) of Section 69 gives the power to the Commissioner to arrest a person where he has reason to believe that the alleged offender has committed any offence specified in clause (a) or clause (b) or clause (c) or clause (d) of sub-section (1) of Section 132 which is punishable under clause (i) or clause (ii) of subsection (1), or sub-section (2) of the Section 132 of CGST Act, 2017. Therefore, before placing a person under arrest, the legal requirements must be fulfilled. The reasons to believe to arrive at a decision to place an alleged offender under arrest must be unambiguous and amply clear. The reasons to believe must be based on credible material. 3.2 Since arrest impinges on the personal liberty of an individual, the power to arrest must be exercised carefully. The arrest should not be made in routine and mechanical manner. Even if all the legal conditions precedent to arrest menti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....son assigned at the time of the arrest of the petitioner justifying his arrest. The arrest of petitioner was made casually in disregard of the procedural safe guards provided in the circular aforesaid. 7. Further reliance has been made on paragraph no. 34 of the judgement of Apex Court in the case of Radhika Agrawal (Supra), which is quoted herein below:- "34. The contention of the DoE that while "grounds of arrest" were mandatorily required to be supplied to the arrestee, "reasons to believe", being an internal and confidential document, need not be disclosed, was decisively rejected in Arvind Kejriwal Vs. Directorate of Enforcement, (2025) 2 SCC 248. It was held that "reasons to believe" are to be furnished to the arrestee such that they can challenge the legality of their arrest. Exceptions are available in one-off cases where appropriate redactions of "reasons to believe" are permissible. The relevant portion reads: "41. Once we hold that the accused is entitled to challenge his arrest under Section 19(1) of the PML Act, the court to examine the validity of arrest must catechise both the existence and soundness of the "reasons to believe", based upon the ma....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... part of the statement and append a note requesting the Magistrate to exclude that part from the copy given to the accused. He has to state the reasons for making such request. The same principle will apply." 8. Further reliance has been made on paragraph Nos. 51, 52, 54, 64 & 66 of the aforesaid judgement: "51. We shall now draw our attention to the provisions of the GST Acts. We have collectively referred to the Central as well as the State GST as "the GST Act". 55. To a large extent, our reasoning and the ratio on the applicability of the Code to the Customs Act would equally apply to the GST Acts in view of Sections 4 and 5 of the Code. Sub-section (10) to Section 67 of the GST Acts postulates that the provisions of the Code relating to search and seizure shall, as far as may be, apply to search and seizure under the GST Acts, subject to the modification that for the purpose of sub-section (5) to Section 165 of the Code, the word 'Magistrate' shall be substituted with the word 'Commissioner'. Section 69, which deals with the power of arrest, a provision which we will refer to subsequently, also deals with the provisions of the Code when the person arrested ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Wing) vide Instruction No. 01/2025-GST dated 13.01.2025 (GST/INV/Instructions/21-22). The circular dated 13.01.2025 now mandates that the grounds of arrest must be explained to the arrested person and also be furnished to him in writing as an Annexure to the arrest memo. The acknowledgement of the same should be taken from the arrested person at the time of service of the arrest memo. 64.3. Instruction 02/2022-23 GST (Investigation) dated 17.08.2022 further lays down that a person nominated or authorised by the arrested person should be informed immediately, and this fact must be recorded in the arrest memo. The date and time of the arrest should also be mentioned in the arrest memo. Lastly, a copy of the arrest memo should be given to the person arrested under proper acknowledgement. 64.4. The circular also makes other directions concerning medical examination, the duty to take reasonable care of the health and safety of the arrested person, and the procedure of arresting a woman, etc. It also lays down the post-arrest formalities which have to be complied with. It further states that efforts should be made to file a prosecution complaint under Section 132 of th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....is writ petitioner deserves to be allowed by granting reliefs sought in the writ petition. 11. Sri Dhnanjay Awasthi, learned counsel for respondent nos. 1 & 2, has vehemently opposed the submissions made by learned Senior Counsel for the petitioner. The first argument of learned counsel for respondent nos. 1 & 2 is that "reasons to believe" are not required to be supplied to the petitioner. There are only internal documents to be perused by the department and the court as Section 69 (1) of the CGST Act, only provides that where Commissioner has reasons to believe that a person has committed any offence specified in clause (a) or clause (b) or clause (c) or clause (d) of sub-section (1) of section 132 which is punishable under clause (i) or (ii) of sub-section (1), or sub-section (2) of the said section, he may, by order, authorise any officer of central tax to arrest such person. 12. He has submitted that "reasons to believe" are not required to be supplied to such person and only Commissioner should have "reasons to believe" that such person has committed the alleged offence. He has submitted that word "may" used in Section has effect of word "shall" and is mandatory in natu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....m record. It is settled law that if the court finds that the order of remand passed by the Magistrate is not in accordance with law. The arrest of the accused in such a case becomes illegal and the this Court has jurisdiction to entertain the habeas corpus writ petition preferred under Article 226 of the Constitution of India. This view finds support from the paragraph no. 28 of the judgement of Apex Court in the case of V. Senthil Balaji Vs. State represented by Deputy Director and others, (2024) 2 Supreme Court Cases 51. 19. The argument of learned Senior Counsel for the petitioner that the "reasons to believe" were required to be furnished to the petitioner alongwith the "grounds of arrest" also needs consideration. From the paragraph no.34 of the judgment of Apex Court in the case of Radhika Agrawal (supra) it is clear that "grounds of arrest" and "reasons to believe" are mandatorily required to be supplied to the arrestee. We find that the aforesaid observation of Hon'ble Supreme Court was with regard to the provisions of P.M.L.A. Act and not GST Act. 20 Our view finds support from the paragraph nos. 58, 59, 60, 61, 64.2 of the judgment of Apex Court in the case of R....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... great circumspection and not casually. Further, as in the case of service tax, the power of arrest is not to be used on mere suspicion or doubt, or for even investigation, when the conditions of sub- section (5) to Section 132 of the GST Acts are not satisfied. 61. However, relying upon the judgment in the case of Makemytrip (supra), it has been submitted on behalf of the petitioners, that the power under sub-section (5) to Section 132 cannot be exercised unless the procedure under Section 73 of the GST Act is completed and an assessment order is passed quantifying the tax evaded or erroneously refunded or input tax credit wrongly availed. According to us, this contention should not be accepted as a general or broad proposition. We would accept that normally the assessment proceedings would quantify the amount of tax evaded, etc. and go on to show whether there is any violation in terms of clauses (a) to (d) to sub-section (1) of Section 132 of the GST Acts and that clause (i) to sub-section (1) is attracted. But there could be cases where even without a formal order of assessment, the department/Revenue is certain that it is a case of offence under clauses (a) to (d) to ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nos. 1 & 2 has pointed to the counter affidavit and has demonstrated that the arrest memo, Jama Talasi, grounds of arrest and intimation regarding arrest of the petitioner sent to his wife were handed over to the petitioner and his wife and their signatures were taken on 16.1.2026 itself when the remand order was passed on 17.1.2026. Therefore, it is clear that the service of grounds of arrest and other documents were made on the petitioner before producing him before Remand Magistrate on 17.1.2026. Therefore, there is full compliance of the mandate of law regarding providing of the "memo of arrest" and "grounds of arrest" to the petitioner and also providing the copy of intimation to his wife about his arrest. 25. Learned Senior Counsel for the petitioner submits that the argument of counsel for respondent nos.1&2 is absolutely incorrect. He has submitted that the signatures of the petitioner were taken on all the documents while in custody and the copy of the same was never supplied to the petitioner or his wife. He has submitted that before the Remand Magistrate it was specifically argued on behalf of the petitioner that the "grounds of arrest" of petitioner was never provide....