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2020 (7) TMI 138 - HC - GSTSearch and Seizure - presence of witnesses in case of search - Sealing of premises of petitioner - Section 67 of the CGST Act - allegation of evasion of tax - HELD THAT - In terms of sub-section 10 of Section 67, presence of two or more independent and respectable inhabitants of the locality is necessary as witness to the search. The search is yet to take place in the present case and the counsel for respondents has duly assured this court that the aforesaid provision will be complied with therefore no direction in this regard at this stage is required - Another submission of counsel for petitioner is that the search should be carried out in the presence of the Advocate, but counsel for petitioner has failed to point out any statutory provision or any such legal right in favour of the petitioner. The submission of the counsel for petitioner to carry out the search and seizure operation in the presence of the petitioner cannot be accepted - Petition dismissed.
Issues Involved:
1. Legality of the sealing of the petitioner's premises under the GST Act. 2. Compliance with the procedure for search and seizure under Section 67 of the GST Act. 3. Petitioner's request for the presence of an advocate during the search and seizure. 4. Assurance of independent witnesses during the search. Detailed Analysis: 1. Legality of the Sealing of the Petitioner's Premises: The petitioner challenged the notice dated 20th June 2020, under which the premises were sealed under the GST Act. The petitioner argued that the sealing was due to actions against a third party, Shri Kishore Wadhwani, for tax evasion, with whom the petitioner claimed no connection apart from leasing the plot. The court noted that the respondents' officials had sealed the premises as it was locked when they arrived for a search and seizure operation. The court found that the respondents had followed the due procedure under Section 67 of the GST Act, which allows for such actions if the premises are inaccessible. 2. Compliance with the Procedure for Search and Seizure under Section 67 of the GST Act: The petitioner contended that the procedure under Section 67 of the GST Act was not followed, particularly regarding the presence of independent witnesses. The court reviewed Section 67, which grants the proper officer the power to inspect, search, and seize goods, documents, or books if they believe there is tax evasion. The court emphasized that the provisions of the Code of Criminal Procedure (Cr.P.C) relating to search and seizure apply, requiring the presence of two independent and respectable inhabitants of the locality. The respondents assured the court that this requirement would be met during the search, and the court found no reason to issue further directions on this matter at this stage. 3. Petitioner's Request for the Presence of an Advocate During the Search and Seizure: The petitioner requested that the search and seizure be conducted in the presence of an advocate, fearing that the search might not be fair and that any confession might be coerced. The court noted that no statutory provision or legal right supports the presence of an advocate during such operations. The court referenced the Supreme Court's decision in Poolpandi vs. Superintendent, Central Excise, which denied similar requests under the Foreign Exchange Regulations Act and the Customs Act. The court held that allowing the presence of an advocate could frustrate the purpose of the inquiry and that there is no constitutional right to such presence. 4. Assurance of Independent Witnesses During the Search: The petitioner expressed concern that the respondents might use their own "pocket witnesses" instead of independent and reputable local witnesses. The court reiterated the requirement under Section 67 of the GST Act and Section 100(4) of the Cr.P.C for the presence of two independent and respectable inhabitants of the locality during the search. The respondents assured the court that this requirement would be complied with, and the court found no reason to doubt this assurance or issue additional directions. Conclusion: The court concluded that the petitioner failed to establish any procedural irregularity or legal right that would warrant interference with the sealing of the premises or the search and seizure operation. The petition was dismissed, with the court noting that the respondents had assured compliance with the necessary legal provisions and procedures.
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