2025 (6) TMI 426 - HC - GST

Seizure by the GST Department in contravention of the Section 67 of the Central Goods and Services Tax Act 2017 - power to seize cash - HELD THAT - In view of the fact that both the Departments i.e. DGGI and Income Tax Department have issued their respective notices and the resumption of cash was allegedly done almost about a year ago the Petitioner Firms are free to defend their position with the said Departments by replying to the concerned show cause notices. In the opinion of the Court no ground for interference with the ongoing proceedings is made out in the present petitions - Petition disposed off.

Summary

The Delhi High Court, through Justices Prathiba M. Singh and Rajneesh Kumar Gupta, dismissed petitions filed under Article 226 by M/s N.P. Industries and M/s Arav Enterprises seeking release of Rs. 25,30,000/- allegedly seized by the GST Department. The Petitioner Firms contended that the GST Department lacked authority under Section 67(2) of the Central Goods and Services Tax Act, 2017 to seize cash. The cash was discovered during a search by the Directorate General of Goods & Services Tax Intelligence (DGGI) at the proprietors' residences and subsequently handed over to the Income Tax Department. Show Cause Notices under the GST Act and reassessment notices under Section 148 of the Income Tax Act were issued thereafter.The Court noted the delay of over a year in challenging the seizure after notices were issued and observed that the Petitioner Firms remain entitled to defend themselves through the ongoing departmental proceedings. The Court held that "no ground for interference with the ongoing proceedings is made out" and left all legal contentions open for adjudication before the authorities. The petitions and any pending applications were disposed of accordingly.