Bombay High Court on Seizure of Cash under GST

In a significant ruling on the limits of GST search and seizure powers, the Bombay High Court held that the Directorate General of GST Intelligence acted without authority of law in seizing cash amounting to ₹1 crore from the petitioner’s premises. 

The Court observed that Section 67 of the CGST Act permits seizure only of goods, documents, books, or things relevant to proceedings, and such action must be supported by a recorded “reason to believe.”

In this case, the department failed to establish such statutory conditions and also failed to issue the mandatory notice within six months as required under the Act. 

The Court therefore quashed the seizure orders and directed the immediate release of the seized cash along with applicable interest. The judgment reinforces the principle that investigative powers under tax laws must strictly adhere to statutory safeguards and cannot be exercised arbitrarily.