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2023 (9) TMI 996 - DELHI HIGH COURTValidity of search and seizure - reason to believe present or not - order of prohibition - impugned SCN issued beyond the period of six months, as contemplated under Sub-section (7) of Section 67 of the CGST - HELD THAT:- Sub-section (2) of Section 67 of the CGST is applicable only when it is not practicable to seize the goods. The contention that it is open for the concerned authorities conducting search, to first pass an order under the first proviso to Sub-section (2) of Section 67 of the CGST and, thereafter, take an informed decision whether to seize the goods, is unmerited. The action for seizure of the goods is required to be predicated on a reason to believe that the goods are liable for confiscation. This condition is required to be satisfied, before passing any order under the proviso to Sub-section (2) of Section 67 of the CGST as well. The first proviso permits the concerned authorities to pass an order prohibiting the tax payer from parting with the goods in cases where goods are liable for seizure, but is not practicable to do so. The order of prohibition is not a stop gap arrangement for the department to take an informed decision whether to seize the goods or not seize the goods. Although Sub-section (7) of Section 67 of the CGST Act refers to seizure of goods under Sub-section (2), it is clear from the scheme of Sub-section (2) of Section 67 of the CGST Act that an order of prohibition, is for all intents and purposes, an order of seizure. However, instead of physically seizing the goods, the taxpayer is directed not to part with or deal with the said goods if it is not practicable to seize the same. The contention that while the concerned authorities are required to return the seized goods if a notice is not issued within a period of six months; the order of prohibition can continue indefinitely, clearly militates against the scheme of Section 67 of the CGST Act. No further orders are required to be passed in this regard as the order of confiscation has already been passed by the concerned authority, and the same is the subject matter of another writ petition filed by the petitioner. The question whether the order of confiscation of goods is valid or is liable to be interfered with by this Court, is a matter to be considered in that petition and no order can be passed in this petition. The contention that the impugned show cause notice is liable to be set aside because it has not been issued within the period of six months from the date of the order of prohibition is unmerited. The consequence of Sub-section (2) of Section 67 of the CGST Act merely provides that if no notice is issued within the stipulated period, the goods seized are liable to be returned. It does not postulate that the notice, issued after six months, is invalid. Thus, the petitioner’s challenge to the impugned show cause notice on the ground that it was issued after six months of the order of prohibition is rejected. Petition disposed off.
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