The appeal arose from an interim order passed by the Gujarat High Court in a writ petition filed by the respondent seeking protection from arrest under Sections 69 and 132 of the Central Goods and Services Tax Act, 2017. In its interim order dated 24 December 2019, the High Court criticized the conduct of the officers during a search operation and observed that statutory protection under Section 157 of the GST Act—relating to “good faith” actions—may not be available to them. The Union of India and State authorities challenged this observation before the Supreme Court, seeking to expunge the remarks as being premature and prejudicial to the officers.

The Supreme Court accepted the State’s request and expunged paragraph 28 of the High Court’s order. It held that the observations denying statutory protection under Section 157 were premature, as no proceedings had been initiated against the officers. The Court explained that the “good faith” clause operates as a defense available to a statutory functionary when prosecution or legal proceedings are actually initiated, and its applicability must be adjudicated within such proceedings.

The Court clarified that under Section 3(22) of the General Clauses Act, 1897, an act done honestly, even if negligently, qualifies as being in good faith. It further observed that the High Court’s opinion, suggesting that the officers “may not” be entitled to such protection, amounted to an advance ruling that could compromise future adjudication.

Accordingly, the Supreme Court expunged the impugned observations and disposed of the appeal, leaving the pending writ petition before the High Court to proceed on its merits without influence from the expunged remarks.