Supreme Court to Decide on Seizure of Cash Under Section 67 of the CGST Act

The Supreme Court is set to resolve whether authorities have the power to seize cash during a search under Section 67 of the Central Goods and Services Tax (CGST) Act, 2017. This follows conflicting judgments by the Delhi High Court and the Madhya Pradesh High Court on the matter. The case stems from a petition filed by tax authorities challenging a Delhi High Court order that directed the return of seized cash to the respondents.

Key Case Details:

Search and Seizure:
In a search conducted at the respondents’ residence under Section 67 of the CGST Act, cash amounting to ₹1.15 crore was seized after the respondents failed to account for it satisfactorily.

Delhi High Court Ruling:
The respondents approached the Delhi High Court, arguing that Section 67 of the CGST Act does not authorize the seizure of cash merely because it was unaccounted for. The court sided with the respondents, citing earlier rulings in Deepak Khandelwal Proprietor M/s Shri Shyam Metal v. Commissioner of CGST, Delhi West & Anr. and Rajeev Chhatwal v. Commissioner of Goods and Services Tax (East). As a result, the court ordered the return of the seized cash.

Contradictory Rulings:
The tax authorities have appealed this decision, highlighting that the Madhya Pradesh High Court took a different stance, ruling that cash can indeed be seized under Section 67.

Supreme Court Involvement:

Due to the conflicting rulings, a bench consisting of Justices PS Narasimha and Sandeep Mehta has issued a notice to address the issue. The Supreme Court will now decide whether the seizure of cash under Section 67 is permissible, as the law does not explicitly mention cash as a “thing” that can be seized.

This case, titled Commissioner of CGST Delhi West & Ors. v. Gunjan Bindal & Anr., Diary No. 44061/2024, could set an important precedent regarding the interpretation of Section 67 of the CGST A

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