SEARCH AND SEIZURE UNDER GST LAW (PART-4)

[Dr. Sanjiv Agarwal]

This part of the article covers matters and different aspects of search and seizure including inter alia, applicability of Code of Criminal Procedure and guiding principles for search under  the GST law.

CBIC Clarification on applicability of Code of Criminal Procedure (Cr.P.C)

CBIC has advised the field formations, guidelines for adherence by officials conducting search proceedings which inter alia include the following:

1. Search should be carried out with proper search authorization issued by the competent authority, who shall record valid and justifiable reasons in the file.
2. Following the instructions related to generation of document identification number (DIN) by the officer authorizing the search.
3. The premises shall be searched only on the authority of a valid search warrant
4. A lady officer shall form part of a search conducted at residences
5. Search to be conducted in the presence of two or more individual witnesses
6. A panchnama containing true account of the search with the list of documents/ goods/ things recovered should be made
7. In sensitive premises, videography of the search proceeding may also be done
8. Appropriate COVID-19 pandemic protocol as provided by the government should be followed

Consequences of illegal search

Search without a valid search warrant (i.e. issued by other than a competent authority or without a search warrant) results in an illegal search without authority of law. However, due to this reason, the accused cannot get benefit but evidence collected even during an illegal search and seizure is considered admissible in trial and adjudication proceedings.

Safeguards available to assessee for a proper and transparent conduct of search operations

The provisions of search and seizure also provides enough safeguards and the GST Law stipulates that search of any place of business etc. can be carried out only under authorisation from an officer not below the rank of Joint Commissioner and if he has a reason to believe that the person concerned has done at least one of the following:

1. Goods liable to confiscation or any documents/ books/record/things, which may be useful for or relevant to any proceedings, are secreted in any place then all such places can be searched
2. All such goods/documents/books/record/things may be seized, however, if it is not practicable to seize any such goods then the same may be detained. The person from whom these are seized shall be entitled to take copies/extracts of seized records
3. The seized documents/books/things shall be retained only till the time the same are required for examination/enquiry/proceedings and if these are not relied on for the case then the same shall be returned within 30 days from the issuance of show cause notice
4. The seized goods shall be provisionally released on execution of bond and furnishing a security or on payment of applicable tax, interest and penalty
5. In case of seizure of goods, a notice has to be issued within six months, if no notice is issued within a period of six months then all such goods shall be returned. However, this period of six months can be extended by Commissioner for another six months on sufficient cause.
6. An inventory of the seized goods/documents/ records is required to be made by the officer and the person, from whom the same are seized, shall be given a copy of the same.
7. To ensure that the provisions for search and seizure are implemented in a proper and transparent manner, the Act stipulates that the searches and seizures shall be carried out in accordance with the provisions of Criminal Procedure Code, 1973. It ensures that any search or seizure should be made in the presence of two or more independent witnesses, a record of entire proceedings is made and forwarded to the Commissioner forthwith.

Guiding Principles on conduct of Search

Generally, revenue officers should observe and follow the below mentioned principles for carrying out any search operations:

• No search of premises should be carried out without a valid search warrant issued by the proper officer.
• There should invariably be a lady officer accompanying the search team to the residence.
• The officers before starting the search should disclose their identity by showing their identity cards to the person in-charge of the premises.
• The search warrant should be executed before the start of the search by showing the same to the person in-charge of the premises and his signature should be taken on the body of the search warrant as a token of having seen the same. The signatures of at least two witnesses should also be taken on the body of the search warrant.
• The search should be made in the presence of at least two independent witnesses of the locality. If no such inhabitants are available/willing, the inhabitants of any other locality should be asked to be witness to the search. The witnesses should be briefed about the purpose of the search.
• Before the start of the search proceedings, the team of officers conducting the search and the accompanying witnesses should offer themselves for their personal search to the person in-charge of the premises being searched. Similarly, after the completion of search all the officers and the witnesses should again offer themselves for their personal search.
• A Panchnama/Mahazar of the proceedings of the search should necessarily be prepared on the spot. A list of all goods, documents recovered and seized/detained should be prepared and annexed to the Panchnama/Mahazar. The Panchnama/Mahazar and the list of goods/documents seized/detained should invariably be signed by the witnesses, the in-charge/owner of the premises before whom the search is conducted and also by the officer(s) duly authorized for conducting the search.
• After the search is over, the search warrant duly executed should be returned in original to the issuing officer with a report regarding the outcome of the search. The names of the officers who participated in the search may also be written on the reverse of the search warrant.
• The issuing authority of search warrant should maintain register of records of search warrant issued and returned and used search warrants should be kept in records.
• A copy of the Panchnama/Mahazar along with its annexure should be given to the person incharge/owner of the premises being searched under acknowledgement.

(To be continued…..)