Sri Apurba Kumar Nath vs. The State Of Assam And 7 Ors

Held

The Court held that the police authorities of Assam could not continue the detention and seizure of trucks carrying areca nuts solely on the plea of GST law violations without invoking and following the procedure prescribed under Section 67 of the AGST Act 2017. If the police believed there was fraud or forgery related to GST documents, they could proceed under the Code of Criminal Procedure (CrPC) and Indian Penal Code (IPC) for those specific offences, provided they followed the CrPC procedures. Regarding the police's power to seize under Section 102 of the CrPC, the Court stated that such seizures must be reported to the Magistrate. The Court also noted the DRI's stance on potential smuggling under the Customs Act, 1962, and the bio-security risk. The Court directed that the seized goods be retained by the police for seven days, during which GST, police, and Customs authorities must decide how to proceed strictly according to their respective laws. If no decision is taken within seven days, the detention and seizure would be declared illegal. The Court modified its earlier judgment, allowing proceedings under GST, CrPC/IPC, or Customs Act, provided the prescribed procedures are followed.

Facts

On August 21, 2019, police detained 25 trucks carrying areca nuts from Cachar district, Assam, due to suspected lack of proper documentation. An additional truck was detained later. Investigations revealed potential manipulation of records, forgery of documents, and discrepancies in GST payment documents, leading to the lodging of an ejahar on September 3, 2019. The petitioner contended that the search and seizure by police were illegal and without jurisdiction, as only designated GST officers could conduct such actions under Section 67 of the Assam Goods and Services Tax Act, 2017. The Directorate of Revenue Intelligence (DRI) indicated that the seized betel nuts were likely smuggled from Myanmar, violating the Customs Act, 1962, and posing a bio-security risk.

Key Issues

1. Whether the search and seizure of trucks carrying areca nuts by police authorities of Assam, alleging evasion of GST dues and forgery of documents, were illegal and without jurisdiction, considering the provisions of the Assam Goods and Services Tax Act, 2017 (AGST Act 2017)? The petitioner argued that under Section 67 of the AGST Act 2017, only a proper officer not below the rank of Joint Commissioner, with reason to believe tax evasion or excess input credit claims, can conduct search and seizure. Therefore, police action was an aberration of law. 2. Whether the police authorities of Assam have the power to seize property under Section 102 of the Code of Criminal Procedure (CrPC) in cases involving alleged violations of GST laws and the Customs Act, 1962? The respondents, including the police, contended that they could seize property under Section 102 of the CrPC. The petitioner argued that any such seizure must adhere to the procedural safeguards outlined in Section 102(3) of the CrPC, requiring submission of a report to the Magistrate.