Gujarat High Court gave an important judgment dated 25th October, 2019 regarding Power of inspection, search and seizure under section 67 (2) in case of Paresh Nathalal Chauhan V. State of Gujarat. In this case, the GST Authorities conducted a search at the premises of the taxpayer pursuant to the authorisation issued under section 67(2). Further in the premises, where there were three ladies, male officers together with a CRPF officer had stayed throughout day and night despite the fact that the goods, articles and things were already seized.

Section 67 empowers the authorised officer to search and seize goods, documents or books or things. It also empowers the authorised officer to seal or break, open door of any premises or to break open any almirah, electronic devices, box, receptacle in which any goods, accounts, registers or documents of the person are suspected to be concealed, where access to such premises, almirah, electronic devices, box or receptacle is denied. Thus the officers concerned were authorised to seize such books, goods, documents, or things which were found at the premises.

But, the said section does not empower the concerned officer to record statements of family members through force or coercion or to record their conversations in their mobile phones. It is not permissible for the authorised officer to use coercive measures against family members to find out the whereabouts of the taxable person.

Gujarat High Court observed and stated that it is shocking to see that in premises, where there are three ladies, male officers together with a CRPF officer have stayed throughout day and night despite the fact that the goods, articles, and things were already seized. The entire exercise carried out by the concerned officers was totally without any authority of law and in flagrant disregard of the provisions of the Act and the Rules and in total abuse of the powers vested in them under the Act.

The manner in which the officers have conducted themselves by overreaching the process of law and acting beyond the powers vested in them under section 67 needs to be deprecated in the strictest terms.

Therefore, HC held that the Commissioner of State Tax, Ahmedabad shall carry out a proper inquiry in respect of the action of the GST Authorities of staying day and night at the premises of the taxpayer without any authority of law and submit a report before the Court. 

OFFICERS ARE NOT ALLOWED TO EXERCISE COERCIVE POWERS UNDER SEARCH AND SEIZURE OPERATIONS