It has also been stated in the reply that during the course of the investigation no evidence could be unearthed that the cash so seized was representing the sale proceeds of unaccounted goods. However, a letter dated 23.10.2023 has been written to the Income Tax Authorities to take over the custody of the fixed deposit of Rs. 1,90,66,000/- with a request to take requisite action as deemed fit under the Income Tax provisions. The learned counsel for the petitioners has submitted that the entire amount resumed was duly accounted for in the books of accounts of the petitioners. However, without verifying the said facts, the currency was resumed illegally by the Officers of the respondents. The learned counsel for the petitioners contended that the CGST Officers had no power to seize the cash in the exercise of their powers under Section 67 (2) of the “Central Goods & Services Tax Act, 2017” (CGST Act). It is argued that powers under Section 67 (2) of the CGST Act to seize goods can only be exercised if the goods are liable for confiscation. It is also argued that the currency is excluded from the definition of goods and thus cannot be seized as goods. It is further submitted that currency is not useful or relevant for conducting any proceedings and therefore the same cannot be seized in the exercise of powers under Section 67 (2) of the CGST Act. The learned Senior Standing Counsel appearing for the respondents has argued that petitioner Mukesh Kapoor could not offer any valid explanation for the source of the cash and therefore the Officers of the respondents were under the bona fide belief that the cash was the result of clandestine and illegal activities of the petitioners contrary to the provisions of the CGST Act 2017, which is why the seizure was effected. The learned counsel for the respondents has placed reliance on the judgment passed by the Hon’ble M.P. High Court in the case of Kanishka Matta Vs. UOI W.P. (C) No. 8204/2020, decided on 26.08.2020, wherein the Hon’ble High Court interpreted the word “things” appearing in Section 67 (2) of the CGST Act, 2017 to include money. Having considered the submissions of the learned counsels for the respective parties, at the outset, it would be appropriate to reproduce the provisions of Section 67 (2) of the CGST Act, which reads as follows: “SECTION 67 OF CGST ACT 2017 67. Power of inspection, search and seizure.— (1) Where the proper officer, not below the rank of Joint Commissioner, has reasons to believe that–– (a) a taxable person has suppressed any transaction relating to the supply of goods or services or both or the stock of goods in hand, or has claimed input tax credit in excess of his entitlement under this Act or has indulged in contravention of any of the provisions of this Act or the rules made thereunder to evade tax under this Act; or (b) any person engaged in the business of transporting goods or an owner or operator of a warehouse or a godown or any other place is keeping goods which have escaped payment of tax or has kept his accounts or goods in such a manner as is likely to cause evasion of tax payable under this Act, he may authorise in writing any other officer of central tax to inspect any places of business of the taxable person or the persons engaged in the business of transporting goods or the owner or the operator of a warehouse or godown or any other place. (2) Where the proper officer, not below the rank of Joint Commissioner, either pursuant to an inspection carried out under sub-section (1) or otherwise, has reasons to believe that any goods liable to confiscation or any documents or books or things, which in his opinion shall be useful for or relevant to any proceedings under this Act, are secreted in any place, he may authorise in writing any other officer of central tax to search and seize or may himself search and seize such goods, documents or books or things: Provided that where it is not practicable to seize any such goods, the proper officer, or any officer authorised by him, may serve on the owner or the custodian of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer: Provided further that the documents or books or things so seized shall be retained by such officer only for so long as may be necessary for their examination and for any inquiry or proceedings under this Act. (3) The documents, books or things referred to in sub-section (2) or any other documents, books or things produced by a taxable person or any other person, which have not been relied upon for the issue of notice under this Act or the rules made thereunder, shall be returned to such person within a period not exceeding thirty days of the issue of the said notice. (4) The officer authorised under sub-section (2) shall have the power to seal or break open the door of any premises or to break open any almirah, electronic devices, box, receptacle in which any goods, accounts, registers or documents of the person are suspected to be concealed, where access to such premises, almirah, electronic devices, box or receptacle is denied. (5) The person from whose custody any documents are seized under sub-section (2) shall be entitled to make copies thereof or take extracts therefrom in the presence of an authorised officer at such place and time as such officer may indicate in this behalf except where making such copies or taking such extracts may, in the opinion of the proper officer, prejudicially affect the investigation. (6) The goods so seized under sub-section (2) shall be released, on a provisional basis, upon execution of a bond and furnishing of a security, in such manner and of such quantum, respectively, as may be prescribed or on payment of applicable tax, interest and penalty payable, as the case may be. (7) Where any goods are seized under sub-section (2) and no notice in respect thereof is given within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized: Provided that the period of six months may, on sufficient cause being shown, be extended by the proper officer for a further period not exceeding six months. (8) The Government may, having regard to the perishable or hazardous nature of any goods, depreciation in the value of the goods with the passage of time, constraints of storage space for the goods or any other relevant considerations, by notification, specify the goods or class of goods which shall, as soon as may be after its seizure under sub-section (2), be disposed of by the proper officer in such manner as may be prescribed. (9) Where any goods, being goods specified under sub-section (8), have been seized by a proper officer, or any officer authorised by him under sub-section (2), he shall prepare an inventory of such goods in such manner as may be prescribed. (10) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974), relating to search and seizure, shall, so far as may be, apply to search and seizure under this section subject to the modification that sub-section (5) of section 165 of the said Code shall have effect as if for the word “Magistrate”, wherever it occurs, the word “Commissioner” were substituted. (11) Where the proper officer has reasons to believe that any person has evaded or is attempting to evade the payment of any tax, he may, for reasons to be recorded in writing, seize the accounts, registers or documents of such person produced before him and shall grant a receipt for the same, and shall retain the same for so long as may be necessary in connection with any proceedings under this Act or the rules made thereunder for prosecution. (12) The Commissioner or an officer authorised by him may cause purchase of any goods or services or both by any person authorised by him from the business premises of any taxable person, to check the issue of tax invoices or bills of supply by such taxable person, and on return of goods so purchased by such officer, such taxable person or any person in charge of the business premises shall refund the amount so paid towards the goods after cancelling any tax invoice or bill of supply issued earlier.”
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