2017 (10) TMI 1644 - HC - Service Tax

Search or seizure - Correctness of officer of the respondents visiting the premises of the petitioner - whether the visit on October 19, 2005 was a simple visit or search or seizure? The serious allegations levelled against the respondents officer by the petitioner, which was required to be noticed that partner of the firm objected the said illegal search and seizure proceedings but he was threatened of being arrest in case of interference and-his statement was recorded no denial has come on record. HELD THAT - In view of the provisions of section 82 which clearly envisage that any documents or books or things which in his useful for or relevant to any proceeding under this Chapter are secreted in any place, he may authorise any Assistant Commissioner of Central Excise to search for and seize or may himself search for any seize, such documents or books or things - From the documents, which are referred in resumption memo, it is very clear that the documents which are referred under section 82 of the Act were seized without search warrant. The action of the respondents is contrary to section 82 of the Act. The whole proceedings are vitiated, therefore, the proceedings of October 19, 2005 deserves to be quashed and set aside - petition allowed.

Summary

Issues:
1. Whether the visit on October 19, 2005, was a simple visit, search, or seizure.

Analysis:
The case involved a challenge to the actions of the respondents regarding a visit to the petitioner's premises on October 19, 2005. The petitioner, a registered partnership firm providing educational coaching, had been regularly filing service tax returns. However, irregularities were found under the Service Tax Code, leading to a visit where documents were seized. The petitioner requested photocopies of the seized records to respond adequately but faced difficulties in obtaining them. Allegations were made regarding the legality of the search and seizure, including lack of proper authorization and failure to follow statutory requirements.

The respondents denied the allegations, stating that the visit was based on directions from the headquarters to investigate a complaint, and no search warrant was required. They defended the actions as necessary for enforcing service tax laws. Discrepancies arose regarding the delivery of the resumption memo and the conduct during the search and seizure process, including alleged threats and lack of proper documentation.

The petitioner contended that the respondents' reliance on a circular for the visit was inappropriate, as it contradicted the specific provisions of section 82 of the Finance Act, 1994. The court noted that the actions of the respondents were not in line with the statutory requirements of section 82, which authorize searches and seizures under certain conditions. The court found the proceedings on October 19, 2005, to be flawed and ordered them to be quashed and set aside, ultimately allowing the petition in favor of the petitioner.