Case Facts:The department issued two show cause notices raising substantial tax, interest, and penalty demands against the petitioner. The petitioner sought documents relied upon in the notices, but claimed inability to access them as they were uploaded on a different portal. Due to this, no reply was filed and ex parte assessment orders were passed creating liability of about Rs. 159 crore. The High Court declined to entertain the writ petition citing availability of alternative remedy under Section 107 requiring pre-deposit. Court Decision:The Court noted the petitioner’s grievance regarding lack of opportunity and financial difficulty in complying with the statutory pre-deposit. It directed the petitioner to deposit Rs. 3.50 crore within two weeks as a condition for further consideration of the matter. Upon such deposit, notice was directed to be issued to the respondents. The Court further ordered that no coercive steps shall be taken pursuant to the assessment orders subject to deposit.
Simla Gomti Pan Products Pvt. Ltd. v. Commissioner of State Tax U.P. & Ors. 20-08-2026
Case Facts:The department issued two show cause notices raising substantial tax, interest, and penalty demands against the petitioner. The petitioner sought documents relied upon in the notices, but claimed inability to access them as they were uploaded on a different portal. Due to this, no reply was filed and ex parte assessment orders were passed creating liability of about Rs. 159 crore. The High Court declined to entertain the writ petition citing availability of alternative remedy under Section 107 requiring pre-deposit. Court Decision:The Court noted the petitioner’s grievance regarding lack of opportunity and financial difficulty in complying with the statutory pre-deposit. It directed the petitioner to deposit Rs. 3.50 crore within two weeks as a condition for further consideration of the matter. Upon such deposit, notice was directed to be issued to the respondents. The Court further ordered that no coercive steps shall be taken pursuant to the assessment orders subject to deposit.
BackgroundSection 65B of the erstwhile Indian Evidence Act, 1872 governed admissibility of electronic records. The Bharatiya Sakshya Adhiniyam, 2023 (BSA) replaced it with Section 63(4), which introduced an enhanced certification requirement — Part A requiring disclosure of the hash value of the electronic/digital record, and Part B requiring a declaration signed by an expert. The Pune Bar Association filed this writ petition before the Supreme Court challenging Section 63(4) read with the Schedule as unconstitutional, contending it imposes an onerous and impossible obligation on ordinary litigants. The Madras High Court in R. v. B & Anr., 2024 SCC OnLine Mad 6084 had additionally held that the "expert" signing Part B must exclusively be an Examiner of Electronic Evidence notified under Section 79A of the Information Technology Act, 2000, which the petitioner contended made the provision even more unworkable as only a handful of such entities are notified by the government. Crucial FactsThe petitioner contended that the requirement of disclosing the hash value of digital records in Part A and obtaining a declaration from a notified expert under Section 79A of the IT Act in Part B renders Section 63(4) manifestly arbitrary and unjust, making admissibility of electronic records illusory in practice for ordinary litigants. The Court examined the rationale behind the hash value requirement and the expert certification requirement. The Court also examined the interplay between Section 39(1) and Section 39(2) of the BSA — Section 39(1) dealing with opinions of persons with special skill in any field, and Section 39(2) specifically dealing with Examiners of Electronic Evidence under Section 79A of the IT Act. The Court noted that Section 39(2), unlike Sections 63(4) and the erstwhile 65B, is not prefaced by a non-obstante clause, meaning Section 39(1) is not excluded from the domain of electronic records — thereby allowing courts to accept opinions of other suitably qualified persons as expert opinion even if not notified under Section 79A. Court Observations (Verbatim — Crucial)Para 4: "Hash value of an electronic data is synonymous with an electronic fingerprint and provides a sure way of identifying and verifying digital data. The necessity of incorporating the hash value of the electronic record in the certificate is thus to ensure its authenticity and integrity, and cannot be said to lack a rational nexus with the object of the Act. Similarly, certification by an expert in Part B provides an additional layer of authenticity to the secondary electronic evidence. For these reasons, we are of the considered view that the new provision has a clear and rational nexus with the object of the law and cannot be said to be either arbitrary or unreasonable so as to suffer from the vice of manifest arbitrariness."Para 7: "If the two sub-sections are read harmoniously, it is possible to hold, in addition to entities notified as Examiner of Electronic Evidence under Section 79A, if the Court is satisfied, on the basis of unimpeachable material, that any other person has special skill and expertise in computer science and cyber forensics, opinion of such person may be held relevant as an expert with regard to electronic/digital record and such person may sign Part B of the Schedule as an expert.""We are further fortified to make such observation as sub-section (2) of Section 39 (unlike 63(4) and erstwhile 65B) is not prefaced by a non-obstante clause so as to exclude the operation of sub-section (1) from the arena of electronic records.""Under these circumstances, we hold that the finding of the High Court that Part B must be filled up by an expert notified under Section 79A of the IT Act shall not be treated as a binding precedent." inclined to admit the matter and issue notice upon the Union of India, we refrain from giving any conclusive opinion on this issue and keep the question of law open." Final VerdictWrit petition disposed of without admission. Section 63(4) of BSA upheld as constitutionally valid — not manifestly arbitrary. The Madras HC finding that Part B must be signed exclusively by a Section 79A notified expert declared not a binding precedent. Question of law kept open. Petition dismissed at threshold — against the petitioner. 👎Cases Referred by Court# Case Name Citation1 R. v. B & Anr. 2024 SCC OnLine Mad 6084 (Madras HC) — finding declared not binding
Pune Bar Association vs. Union of India and Others 22-05-2026
BackgroundSection 65B of the erstwhile Indian Evidence Act, 1872 governed admissibility of electronic records. The Bharatiya Sakshya Adhiniyam, 2023 (BSA) replaced it with Section 63(4), which introduced an enhanced certification requirement — Part A requiring disclosure of the hash value of the electronic/digital record, and Part B requiring a declaration signed by an expert. The Pune Bar Association filed this writ petition before the Supreme Court challenging Section 63(4) read with the Schedule as unconstitutional, contending it imposes an onerous and impossible obligation on ordinary litigants. The Madras High Court in R. v. B & Anr., 2024 SCC OnLine Mad 6084 had additionally held that the "expert" signing Part B must exclusively be an Examiner of Electronic Evidence notified under Section 79A of the Information Technology Act, 2000, which the petitioner contended made the provision even more unworkable as only a handful of such entities are notified by the government. Crucial FactsThe petitioner contended that the requirement of disclosing the hash value of digital records in Part A and obtaining a declaration from a notified expert under Section 79A of the IT Act in Part B renders Section 63(4) manifestly arbitrary and unjust, making admissibility of electronic records illusory in practice for ordinary litigants. The Court examined the rationale behind the hash value requirement and the expert certification requirement. The Court also examined the interplay between Section 39(1) and Section 39(2) of the BSA — Section 39(1) dealing with opinions of persons with special skill in any field, and Section 39(2) specifically dealing with Examiners of Electronic Evidence under Section 79A of the IT Act. The Court noted that Section 39(2), unlike Sections 63(4) and the erstwhile 65B, is not prefaced by a non-obstante clause, meaning Section 39(1) is not excluded from the domain of electronic records — thereby allowing courts to accept opinions of other suitably qualified persons as expert opinion even if not notified under Section 79A. Court Observations (Verbatim — Crucial)Para 4: "Hash value of an electronic data is synonymous with an electronic fingerprint and provides a sure way of identifying and verifying digital data. The necessity of incorporating the hash value of the electronic record in the certificate is thus to ensure its authenticity and integrity, and cannot be said to lack a rational nexus with the object of the Act. Similarly, certification by an expert in Part B provides an additional layer of authenticity to the secondary electronic evidence. For these reasons, we are of the considered view that the new provision has a clear and rational nexus with the object of the law and cannot be said to be either arbitrary or unreasonable so as to suffer from the vice of manifest arbitrariness."Para 7: "If the two sub-sections are read harmoniously, it is possible to hold, in addition to entities notified as Examiner of Electronic Evidence under Section 79A, if the Court is satisfied, on the basis of unimpeachable material, that any other person has special skill and expertise in computer science and cyber forensics, opinion of such person may be held relevant as an expert with regard to electronic/digital record and such person may sign Part B of the Schedule as an expert.""We are further fortified to make such observation as sub-section (2) of Section 39 (unlike 63(4) and erstwhile 65B) is not prefaced by a non-obstante clause so as to exclude the operation of sub-section (1) from the arena of electronic records.""Under these circumstances, we hold that the finding of the High Court that Part B must be filled up by an expert notified under Section 79A of the IT Act shall not be treated as a binding precedent." inclined to admit the matter and issue notice upon the Union of India, we refrain from giving any conclusive opinion on this issue and keep the question of law open." Final VerdictWrit petition disposed of without admission. Section 63(4) of BSA upheld as constitutionally valid — not manifestly arbitrary. The Madras HC finding that Part B must be signed exclusively by a Section 79A notified expert declared not a binding precedent. Question of law kept open. Petition dismissed at threshold — against the petitioner. 👎Cases Referred by Court# Case Name Citation1 R. v. B & Anr. 2024 SCC OnLine Mad 6084 (Madras HC) — finding declared not binding
Facts:The respondent purchasing dealers claimed Input Tax Credit (ITC) on purchases made from various sellers. The Assessing Officer disallowed ITC on the ground that several selling dealers were deregistered, had not filed returns, or denied transactions, raising doubts about genuineness. The first Appellate Authority upheld the disallowance. However, the Tribunal and High Court allowed ITC primarily on the basis of invoices and payments through cheques. Court Decision:The Supreme Court held that the burden under Section 70 lies on the purchasing dealer to prove the genuineness of transactions. Mere production of invoices or payment through banking channels is not sufficient. The dealer must establish actual physical movement of goods and provide supporting evidence such as transport details, delivery acknowledgment, and seller details. Since the purchasing dealers failed to discharge this burden, the Court set aside the High Court and Tribunal orders and restored the disallowance of ITC by the Assessing Officer. Cases Referred by Court:• Corporation Bank v. Saraswati Abharansala (2009) 19 VST 84 (SC) • Bhagadia Brothers v. Additional Commissioner of Commercial Taxes (Karnataka High Court) • Madhav Steel Corporation v. State of Gujarat (Gujarat High Court) • Shreeji Impex v. State of Gujarat (Gujarat High Court) • On Quest Merchandising India Pvt. Ltd. v. Government of NCT of Delhi
State of Karnataka v. Ecom Gill Coffee Trading Private Limited 13-03-2026
Facts:The respondent purchasing dealers claimed Input Tax Credit (ITC) on purchases made from various sellers. The Assessing Officer disallowed ITC on the ground that several selling dealers were deregistered, had not filed returns, or denied transactions, raising doubts about genuineness. The first Appellate Authority upheld the disallowance. However, the Tribunal and High Court allowed ITC primarily on the basis of invoices and payments through cheques. Court Decision:The Supreme Court held that the burden under Section 70 lies on the purchasing dealer to prove the genuineness of transactions. Mere production of invoices or payment through banking channels is not sufficient. The dealer must establish actual physical movement of goods and provide supporting evidence such as transport details, delivery acknowledgment, and seller details. Since the purchasing dealers failed to discharge this burden, the Court set aside the High Court and Tribunal orders and restored the disallowance of ITC by the Assessing Officer. Cases Referred by Court:• Corporation Bank v. Saraswati Abharansala (2009) 19 VST 84 (SC) • Bhagadia Brothers v. Additional Commissioner of Commercial Taxes (Karnataka High Court) • Madhav Steel Corporation v. State of Gujarat (Gujarat High Court) • Shreeji Impex v. State of Gujarat (Gujarat High Court) • On Quest Merchandising India Pvt. Ltd. v. Government of NCT of Delhi
Facts:An FIR was registered alleging an organised racket involving forged LL.B. degrees and fake academic certificates used to impersonate advocates. Respondent No. 2 allegedly procured and used a forged law degree to practice as an advocate and facilitate similar fraud for others. The Sessions Court rejected bail, but the High Court granted bail relying on disputed documents and claims of innocence. The appellant challenged the bail order citing suppression of multiple FIRs, serious criminal antecedents, and reliance on forged material. Court Decision:The Supreme Court set aside the High Court’s order granting bail, holding it to be perverse and legally unsustainable. It held that the High Court relied on disputed and prima facie forged documents, ignored material evidence, and failed to consider criminal antecedents and gravity of offences. The Court emphasized that suppression of material facts, including multiple FIRs, vitiates the exercise of judicial discretion in granting bail. It clarified that appellate courts can annul bail where the order suffers from illegality, perversity, or non-consideration of relevant factors, irrespective of post-bail conduct. The prayer for transfer of investigation to a special agency was rejected as investigation was complete and no exceptional circumstances were shown. Cases Referred by Court:• State of Karnataka v. Sri Darshan • Yogendra Pal Singh v. Raghvendra Singh • Manik Madhukar Sarve v. Vitthal Damuji Meher • Ajwar v. Waseem • Mahipal v. Rajesh Kumar • P v. State of Madhya Pradesh • Dolat Ram v. State of Haryana • Prasanta Kumar Sarkar v. Ashis Chatterjee • Ash Mohammad v. Shiv Raj Singh • Neeru Yadav v. State of Uttar Pradesh • Brijmani Devi v. Pappu Kumar • Disha v. State of Gujarat • K.V. Rajendran v. Superintendent of Police • Kusha Duruka v. State of Odisha
Zeba Khan v. State of Uttar Pradesh & Ors. 28-02-2026
Facts:An FIR was registered alleging an organised racket involving forged LL.B. degrees and fake academic certificates used to impersonate advocates. Respondent No. 2 allegedly procured and used a forged law degree to practice as an advocate and facilitate similar fraud for others. The Sessions Court rejected bail, but the High Court granted bail relying on disputed documents and claims of innocence. The appellant challenged the bail order citing suppression of multiple FIRs, serious criminal antecedents, and reliance on forged material. Court Decision:The Supreme Court set aside the High Court’s order granting bail, holding it to be perverse and legally unsustainable. It held that the High Court relied on disputed and prima facie forged documents, ignored material evidence, and failed to consider criminal antecedents and gravity of offences. The Court emphasized that suppression of material facts, including multiple FIRs, vitiates the exercise of judicial discretion in granting bail. It clarified that appellate courts can annul bail where the order suffers from illegality, perversity, or non-consideration of relevant factors, irrespective of post-bail conduct. The prayer for transfer of investigation to a special agency was rejected as investigation was complete and no exceptional circumstances were shown. Cases Referred by Court:• State of Karnataka v. Sri Darshan • Yogendra Pal Singh v. Raghvendra Singh • Manik Madhukar Sarve v. Vitthal Damuji Meher • Ajwar v. Waseem • Mahipal v. Rajesh Kumar • P v. State of Madhya Pradesh • Dolat Ram v. State of Haryana • Prasanta Kumar Sarkar v. Ashis Chatterjee • Ash Mohammad v. Shiv Raj Singh • Neeru Yadav v. State of Uttar Pradesh • Brijmani Devi v. Pappu Kumar • Disha v. State of Gujarat • K.V. Rajendran v. Superintendent of Police • Kusha Duruka v. State of Odisha
Facts:An FIR was registered by the Economic Offences Wing, Delhi Police alleging that the accused induced a large number of investors by falsely claiming divine powers to triple their money. Around 1,852 victims were cheated of approximately ₹46.40 crores. The police registered a single FIR and treated complaints of other victims as statements during investigation. The Delhi High Court held that each deposit constituted a separate transaction requiring separate FIRs. Court Decision:The Supreme Court held that the reference made by the Additional Sessions Judge to the High Court was premature as the investigation had not concluded. The Court observed that whether multiple acts constitute the “same transaction” must be determined based on the facts emerging from the investigation.The Court noted that when offences arise from a common conspiracy and may form part of the same transaction, it is permissible to register one FIR and treat subsequent complaints as statements under Section 161 CrPC. The police were justified in registering a single FIR alleging criminal conspiracy under Section 120B IPC and treating complaints of other victims as statements.The Court clarified that the Magistrate will determine at the stage of framing of charges whether the acts constitute the same transaction under Sections 220(1) and 223 CrPC, enabling joint trial. If the acts are distinct transactions, separate trials may be conducted subject to Section 219 CrPC.Accordingly, the Supreme Court set aside the Delhi High Court’s answers which mandated separate FIRs for each transaction and allowed the appeal filed by the State.Cases Referred by Court:• S. Swamirathnam vs. State of Madras• Banwarilal Jhunjhunwala vs. Union of India• State of Andhra Pradesh vs. Cheemalapati Ganeswara Rao• State of Jharkhand vs. Lalu Prasad Yadav• Amish Devgan vs. Union of India• T.T. Antony vs. State of Kerala• Arnab Ranjan Goswami vs. Union of India• Abhishek Singh Chauhan vs. Union of India• Amanat Ali vs. State of Karnataka• Ravinder Singh Sidhu vs. State of Punjab• Alok Kumar vs. State of Bihar• Satinder Singh Bhasin vs. State of Uttar Pradesh• Radhey Shyam vs. State of Haryana• Amandeep Singh Saran vs. State of Delhi• Narinderjit Singh Sahni vs. Union of India
The State (NCT) of Delhi vs. Khimji Bhai Jadeja 06-01-2026
Facts:An FIR was registered by the Economic Offences Wing, Delhi Police alleging that the accused induced a large number of investors by falsely claiming divine powers to triple their money. Around 1,852 victims were cheated of approximately ₹46.40 crores. The police registered a single FIR and treated complaints of other victims as statements during investigation. The Delhi High Court held that each deposit constituted a separate transaction requiring separate FIRs. Court Decision:The Supreme Court held that the reference made by the Additional Sessions Judge to the High Court was premature as the investigation had not concluded. The Court observed that whether multiple acts constitute the “same transaction” must be determined based on the facts emerging from the investigation.The Court noted that when offences arise from a common conspiracy and may form part of the same transaction, it is permissible to register one FIR and treat subsequent complaints as statements under Section 161 CrPC. The police were justified in registering a single FIR alleging criminal conspiracy under Section 120B IPC and treating complaints of other victims as statements.The Court clarified that the Magistrate will determine at the stage of framing of charges whether the acts constitute the same transaction under Sections 220(1) and 223 CrPC, enabling joint trial. If the acts are distinct transactions, separate trials may be conducted subject to Section 219 CrPC.Accordingly, the Supreme Court set aside the Delhi High Court’s answers which mandated separate FIRs for each transaction and allowed the appeal filed by the State.Cases Referred by Court:• S. Swamirathnam vs. State of Madras• Banwarilal Jhunjhunwala vs. Union of India• State of Andhra Pradesh vs. Cheemalapati Ganeswara Rao• State of Jharkhand vs. Lalu Prasad Yadav• Amish Devgan vs. Union of India• T.T. Antony vs. State of Kerala• Arnab Ranjan Goswami vs. Union of India• Abhishek Singh Chauhan vs. Union of India• Amanat Ali vs. State of Karnataka• Ravinder Singh Sidhu vs. State of Punjab• Alok Kumar vs. State of Bihar• Satinder Singh Bhasin vs. State of Uttar Pradesh• Radhey Shyam vs. State of Haryana• Amandeep Singh Saran vs. State of Delhi• Narinderjit Singh Sahni vs. Union of India
Facts The issue before the Court was whether purchasing dealers who paid tax to registered selling dealers are entitled to Input Tax Credit even if the selling dealers failed to deposit the tax with the Government. The selling dealers were registered at the time of transactions but later defaulted and their registrations were cancelled. The Delhi High Court held that the purchasing dealers were bona fide and entitled to ITC. The Revenue challenged this decision before the Supreme Court. Court Decision:The Supreme Court dismissed the appeals and upheld the High Court’s decision. It held that where transactions and invoices are genuine and the selling dealer was registered at the time of transaction, ITC cannot be denied to bona fide purchasing dealers. The Court found no reason to interfere with the grant of ITC after due verification. Cases Referred by Court:• On Quest Merchandising India Pvt. Ltd. v. Government of NCT of Delhi • Commissioner of Trade and Taxes v. Arise India Ltd.
Commissioner of Trade and Tax, Delhi v. Shanti Kiran India (P) Ltd. 09-10-2025
Facts The issue before the Court was whether purchasing dealers who paid tax to registered selling dealers are entitled to Input Tax Credit even if the selling dealers failed to deposit the tax with the Government. The selling dealers were registered at the time of transactions but later defaulted and their registrations were cancelled. The Delhi High Court held that the purchasing dealers were bona fide and entitled to ITC. The Revenue challenged this decision before the Supreme Court. Court Decision:The Supreme Court dismissed the appeals and upheld the High Court’s decision. It held that where transactions and invoices are genuine and the selling dealer was registered at the time of transaction, ITC cannot be denied to bona fide purchasing dealers. The Court found no reason to interfere with the grant of ITC after due verification. Cases Referred by Court:• On Quest Merchandising India Pvt. Ltd. v. Government of NCT of Delhi • Commissioner of Trade and Taxes v. Arise India Ltd.
Facts :The petitioner company received a show cause notice under Section 73 CGST Act from State GST authorities for alleged tax shortfall and excess ITC.Subsequently, Central GST authorities conducted a search and issued summons under Section 70 requiring production of documents.The petitioner challenged the summons before Delhi High Court, contending that parallel proceedings on the same subject matter were barred under Section 6(2)(b).The High Court dismissed the writ petition, holding that summons and investigation are not “proceedings”.Court Decision:The Supreme Court upheld the High Court’s view and dismissed the SLP.It held that issuance of summons under Section 70 is part of inquiry/investigation and cannot be equated with “initiation of proceedings” under Section 6(2)(b).“Proceedings” under Section 6(2)(b) refer to adjudicatory actions such as assessment, demand, or penalty proceedings under Sections 73 or 74.Summons is only a step to collect evidence and precedes formal proceedings; hence, no bar on parallel inquiry by another authority.The Court interpreted Section 6 within the framework of “single interface” and “cross-empowerment”, holding that intelligence-based enforcement actions can be initiated by both Central and State authorities.Cases Referred:G.K. Trading v. Union of IndiaKuppan Gounder P.G. Natarajan v. Directorate General of GST IntelligenceAnurag Suri v. Director General of GST IntelligenceIndo International Tobacco Ltd. v. Vivek PrasadK.T. Saidalavi v. State Tax OfficerRais Khan v. Addl. CommissionerM/s R.P. Buildcon Pvt. Ltd. v. Superintendent, CGSTTvl. Metal Trade Incorporation v. GST Council SecretariatVivek Narsaria v. State of JharkhandStalwart Alloys India Pvt. Ltd. v. Union of IndiaKundlas Loh Udyog v. State of H.P.Chief Commissioner of CGST v. Safari Retreats Pvt. Ltd.K.P. Mohammed Salim v. CIT
Armour Security (India) Ltd. vs Commissioner, CGST, Delhi East Commissionerate & Anr. 06-03-2025
Facts :The petitioner company received a show cause notice under Section 73 CGST Act from State GST authorities for alleged tax shortfall and excess ITC.Subsequently, Central GST authorities conducted a search and issued summons under Section 70 requiring production of documents.The petitioner challenged the summons before Delhi High Court, contending that parallel proceedings on the same subject matter were barred under Section 6(2)(b).The High Court dismissed the writ petition, holding that summons and investigation are not “proceedings”.Court Decision:The Supreme Court upheld the High Court’s view and dismissed the SLP.It held that issuance of summons under Section 70 is part of inquiry/investigation and cannot be equated with “initiation of proceedings” under Section 6(2)(b).“Proceedings” under Section 6(2)(b) refer to adjudicatory actions such as assessment, demand, or penalty proceedings under Sections 73 or 74.Summons is only a step to collect evidence and precedes formal proceedings; hence, no bar on parallel inquiry by another authority.The Court interpreted Section 6 within the framework of “single interface” and “cross-empowerment”, holding that intelligence-based enforcement actions can be initiated by both Central and State authorities.Cases Referred:G.K. Trading v. Union of IndiaKuppan Gounder P.G. Natarajan v. Directorate General of GST IntelligenceAnurag Suri v. Director General of GST IntelligenceIndo International Tobacco Ltd. v. Vivek PrasadK.T. Saidalavi v. State Tax OfficerRais Khan v. Addl. CommissionerM/s R.P. Buildcon Pvt. Ltd. v. Superintendent, CGSTTvl. Metal Trade Incorporation v. GST Council SecretariatVivek Narsaria v. State of JharkhandStalwart Alloys India Pvt. Ltd. v. Union of IndiaKundlas Loh Udyog v. State of H.P.Chief Commissioner of CGST v. Safari Retreats Pvt. Ltd.K.P. Mohammed Salim v. CIT
Facts of the CaseThe present batch of writ petitions and criminal appeals raised a common question regarding the legality and scope of arrest powers exercised by officers under the Customs Act, 1962 and the GST Act, 2017. The controversy stemmed from the three-Judge Bench decision in Om Prakash v. Union of India (2011), which had held that offences under the Customs Act and Central Excise Act were non-cognizable and bailable, and that arrest could not be made without a warrant from the Magistrate.After that decision, Parliament amended the Customs Act in 2012, 2013 and 2019. Certain specified offences were declared cognizable, and some were further declared non-bailable. Similar legislative structure was adopted in the GST Act. Despite these amendments, challenges continued to be raised questioning the power of customs officers to arrest without warrant, the applicability of provisions of the Code of Criminal Procedure, and whether customs officers were to be treated as “police officers.”The matters reached the Supreme Court to determine:Whether the ratio in Om Prakash continued to apply after statutory amendments.Whether customs officers are police officers.To what extent provisions of the Code of Criminal Procedure apply to arrests under the Customs Act.What safeguards must be observed while exercising the power of arrest.Court’s Observations and DecisionThe Court declined to reopen the correctness of Om Prakash, noting that the legislature had consciously amended the Customs Act after that judgment. The amendments carved out specific offences as cognizable and certain serious offences as non-bailable. Therefore, the statutory scheme now governs the classification of offences.The Court held:Customs officers are not police officers, as consistently held in earlier Constitution Bench decisions.However, even though they are not police officers, procedural safeguards under the Code of Criminal Procedure apply unless expressly excluded by the special statute.Sections 4 and 5 of the Code make it clear that provisions of the Code apply to offences under special laws unless a contrary procedure is prescribed.The Court clarified the legal position post-amendment:Offences specified under Section 104(4) of the Customs Act are cognizable.Certain offences under Section 104(6) are non-bailable.All other offences are non-cognizable and bailable.The Court emphasized that the power of arrest is a drastic power affecting personal liberty and must be exercised strictly in accordance with statutory safeguards. It applied principles earlier laid down in cases dealing with arrest under special statutes, including those under the PMLA.The Court held that the following safeguards are mandatory:The officer must have “material” and must form “reasons to believe” before arrest.Grounds of arrest must be informed to the arrestee.Proper records and diary must be maintained.Safeguards under Sections 41B, 41D, 50A and 55A of the Code apply.The arrestee has a right to meet an advocate during interrogation, though not throughout.Magistrates must ensure compliance with procedural safeguards at the time of production.The Court further held that judicial review of arrest is permissible. Courts can examine whether the statutory preconditions for arrest were satisfied.Case ReferredOm Prakash and Another v. Union of India and Another, (2011) 14 SCC 1, Supreme Court of India.Directorate of Enforcement v. Deepak Mahajan, (1994) 3 SCC 440, Supreme Court of India.A.R. Antulay v. Ramdas Sriniwas Nayak, (1984) 2 SCC 500, Supreme Court of India.State of Punjab v. Barkat Ram, (1962) 3 SCR 338, Supreme Court of India.Ramesh Chandra Mehta v. State of West Bengal, (1969) 2 SCR 461, Supreme Court of India (Constitution Bench).Illias v. Collector of Customs, (1969) 2 SCR 613, Supreme Court of India (Constitution Bench).Tofan Singh v. State of Tamil Nadu, (2021) 4 SCC 1, Supreme Court of India.Union of India v. Ashok Kumar Sharma, (2021) 12 SCC 674, Supreme Court of India.D.K. Basu v. State of West Bengal, (1997) 1 SCC 416, Supreme Court of India.Senior Intelligence Officer, DRI v. Jugal Kishore Samra, (2011) 12 SCC 362, Supreme Court of India.Arvind Kejriwal v. Directorate of Enforcement, (2025) 2 SCC 248, Supreme Court of India.Pankaj Bansal v. Union of India, 2023 SCC OnLine SC 1244, Supreme Court of India.Prabir Purkayastha v. State (NCT of Delhi), (2024) 7 SCC 576, Supreme Court of India.Vijay Madanlal Choudhary v. Union of India, 2022 SCC OnLine SC 929, Supreme Court of India.
Facts of the CaseThe present batch of writ petitions and criminal appeals raised a common question regarding the legality and scope of arrest powers exercised by officers under the Customs Act, 1962 and the GST Act, 2017. The controversy stemmed from the three-Judge Bench decision in Om Prakash v. Union of India (2011), which had held that offences under the Customs Act and Central Excise Act were non-cognizable and bailable, and that arrest could not be made without a warrant from the Magistrate.After that decision, Parliament amended the Customs Act in 2012, 2013 and 2019. Certain specified offences were declared cognizable, and some were further declared non-bailable. Similar legislative structure was adopted in the GST Act. Despite these amendments, challenges continued to be raised questioning the power of customs officers to arrest without warrant, the applicability of provisions of the Code of Criminal Procedure, and whether customs officers were to be treated as “police officers.”The matters reached the Supreme Court to determine:Whether the ratio in Om Prakash continued to apply after statutory amendments.Whether customs officers are police officers.To what extent provisions of the Code of Criminal Procedure apply to arrests under the Customs Act.What safeguards must be observed while exercising the power of arrest.Court’s Observations and DecisionThe Court declined to reopen the correctness of Om Prakash, noting that the legislature had consciously amended the Customs Act after that judgment. The amendments carved out specific offences as cognizable and certain serious offences as non-bailable. Therefore, the statutory scheme now governs the classification of offences.The Court held:Customs officers are not police officers, as consistently held in earlier Constitution Bench decisions.However, even though they are not police officers, procedural safeguards under the Code of Criminal Procedure apply unless expressly excluded by the special statute.Sections 4 and 5 of the Code make it clear that provisions of the Code apply to offences under special laws unless a contrary procedure is prescribed.The Court clarified the legal position post-amendment:Offences specified under Section 104(4) of the Customs Act are cognizable.Certain offences under Section 104(6) are non-bailable.All other offences are non-cognizable and bailable.The Court emphasized that the power of arrest is a drastic power affecting personal liberty and must be exercised strictly in accordance with statutory safeguards. It applied principles earlier laid down in cases dealing with arrest under special statutes, including those under the PMLA.The Court held that the following safeguards are mandatory:The officer must have “material” and must form “reasons to believe” before arrest.Grounds of arrest must be informed to the arrestee.Proper records and diary must be maintained.Safeguards under Sections 41B, 41D, 50A and 55A of the Code apply.The arrestee has a right to meet an advocate during interrogation, though not throughout.Magistrates must ensure compliance with procedural safeguards at the time of production.The Court further held that judicial review of arrest is permissible. Courts can examine whether the statutory preconditions for arrest were satisfied.Case ReferredOm Prakash and Another v. Union of India and Another, (2011) 14 SCC 1, Supreme Court of India.Directorate of Enforcement v. Deepak Mahajan, (1994) 3 SCC 440, Supreme Court of India.A.R. Antulay v. Ramdas Sriniwas Nayak, (1984) 2 SCC 500, Supreme Court of India.State of Punjab v. Barkat Ram, (1962) 3 SCR 338, Supreme Court of India.Ramesh Chandra Mehta v. State of West Bengal, (1969) 2 SCR 461, Supreme Court of India (Constitution Bench).Illias v. Collector of Customs, (1969) 2 SCR 613, Supreme Court of India (Constitution Bench).Tofan Singh v. State of Tamil Nadu, (2021) 4 SCC 1, Supreme Court of India.Union of India v. Ashok Kumar Sharma, (2021) 12 SCC 674, Supreme Court of India.D.K. Basu v. State of West Bengal, (1997) 1 SCC 416, Supreme Court of India.Senior Intelligence Officer, DRI v. Jugal Kishore Samra, (2011) 12 SCC 362, Supreme Court of India.Arvind Kejriwal v. Directorate of Enforcement, (2025) 2 SCC 248, Supreme Court of India.Pankaj Bansal v. Union of India, 2023 SCC OnLine SC 1244, Supreme Court of India.Prabir Purkayastha v. State (NCT of Delhi), (2024) 7 SCC 576, Supreme Court of India.Vijay Madanlal Choudhary v. Union of India, 2022 SCC OnLine SC 929, Supreme Court of India.
Court DecisionThe Supreme Court dismissed the Special Leave Petitions filed by the Union of India against the judgment of the Bombay High Court.The Court noted that the High Court had quashed the show cause notices seeking recovery of ₹3731 crores from the respondent, holding that:The basic jurisdictional requirements were not attracted for invoking Section 122(1A) and Section 137 of the CGST Act.No principle of vicarious liability could be read into Sections 122 and 137.The respondent was merely an employee and could not be fastened with the liability alleged against the company.The Supreme Court held that it saw no good reason to interfere with the common impugned orders passed by the High Court.However, the Court clarified that the question of law regarding the interpretation of Sections 122(1A) and 137 of the CGST Act was kept open.Accordingly, the Special Leave Petitions were dismissed and pending applications were disposed of. Cases Referred by the CourtShantanu Sanjay Hundekari vs. Union of India & Ors., WPL Nos. 30198/2023, 30199/2023, 30200/2023 & 30241/2023 (Bombay High Court, judgment dated 28 March 2024)
Union of India & Ors. vs. Shantanu Sanjay Hundekari & Anr. Etc. 24-01-2025
Court DecisionThe Supreme Court dismissed the Special Leave Petitions filed by the Union of India against the judgment of the Bombay High Court.The Court noted that the High Court had quashed the show cause notices seeking recovery of ₹3731 crores from the respondent, holding that:The basic jurisdictional requirements were not attracted for invoking Section 122(1A) and Section 137 of the CGST Act.No principle of vicarious liability could be read into Sections 122 and 137.The respondent was merely an employee and could not be fastened with the liability alleged against the company.The Supreme Court held that it saw no good reason to interfere with the common impugned orders passed by the High Court.However, the Court clarified that the question of law regarding the interpretation of Sections 122(1A) and 137 of the CGST Act was kept open.Accordingly, the Special Leave Petitions were dismissed and pending applications were disposed of. Cases Referred by the CourtShantanu Sanjay Hundekari vs. Union of India & Ors., WPL Nos. 30198/2023, 30199/2023, 30200/2023 & 30241/2023 (Bombay High Court, judgment dated 28 March 2024)
Case Facts:The respondent constructed a shopping mall for leasing purposes and paid GST on inputs like materials and services used in construction, accumulating substantial ITC. The department denied ITC relying on Section 17(5)(d), which blocks credit for construction of immovable property. The Orissa High Court read down the provision and allowed ITC, holding denial would defeat GST objectives. The Revenue challenged this before the Supreme Court along with similar matters questioning the constitutional validity of Section 17(5)(c) and (d).Court Decision:The Supreme Court examined the scheme of the CGST Act and held that ITC is a statutory right subject to conditions and restrictions under the Act. Section 17(5)(c) and (d) clearly restrict ITC on construction of immovable property (other than plant and machinery), and such restriction must be interpreted strictly.The Court upheld the validity of the provisions and rejected the interpretation adopted by the High Court. It held that:A taxing statute must be interpreted strictly based on plain language.ITC cannot be claimed contrary to express statutory restrictions.The legislature is competent to restrict ITC and such restriction does not violate constitutional provisions.The expression “plant or machinery” cannot be expansively interpreted to include buildings like malls merely to claim ITC.Accordingly, the Supreme Court set aside the High Court judgment and held that ITC is not available on construction of immovable property used for renting under Section 17(5)(d).Cases Referred by Court:Eicher Motors Ltd. v. Union of IndiaBharat Sanchar Nigam Ltd. v. Union of IndiaShreya Singhal v. Union of IndiaUnion of India v. Bharti Airtel Ltd.Federation of Hotel & Restaurant Association of India v. Union of IndiaR.K. Garg v. Union of IndiaTwyford Tea Co. Ltd. v. State of KeralaNitdip Textile Processors Pvt. Ltd.P. Laxmi Devi v. State of Andhra PradeshIndore Development Authority v. ManoharlalALD Automotive Pvt. Ltd. v. Commercial Tax OfficerHari Krishna Bhargav v. Union of IndiaJoseph Shine v. Union of IndiaCommissioner of Customs v. Dilip Kumar & Co.Sneh Enterprises v. Commissioner of CustomsVegetable Products Ltd.R.S. Raghunath v. State of KarnatakaUnion of India v. VKC Footsteps India Pvt. Ltd.
Chief Commissioner of Central Goods and Service Tax & Ors. Vs. Safari Retreats Private Ltd. & Ors. 03-10-2024
Case Facts:The respondent constructed a shopping mall for leasing purposes and paid GST on inputs like materials and services used in construction, accumulating substantial ITC. The department denied ITC relying on Section 17(5)(d), which blocks credit for construction of immovable property. The Orissa High Court read down the provision and allowed ITC, holding denial would defeat GST objectives. The Revenue challenged this before the Supreme Court along with similar matters questioning the constitutional validity of Section 17(5)(c) and (d).Court Decision:The Supreme Court examined the scheme of the CGST Act and held that ITC is a statutory right subject to conditions and restrictions under the Act. Section 17(5)(c) and (d) clearly restrict ITC on construction of immovable property (other than plant and machinery), and such restriction must be interpreted strictly.The Court upheld the validity of the provisions and rejected the interpretation adopted by the High Court. It held that:A taxing statute must be interpreted strictly based on plain language.ITC cannot be claimed contrary to express statutory restrictions.The legislature is competent to restrict ITC and such restriction does not violate constitutional provisions.The expression “plant or machinery” cannot be expansively interpreted to include buildings like malls merely to claim ITC.Accordingly, the Supreme Court set aside the High Court judgment and held that ITC is not available on construction of immovable property used for renting under Section 17(5)(d).Cases Referred by Court:Eicher Motors Ltd. v. Union of IndiaBharat Sanchar Nigam Ltd. v. Union of IndiaShreya Singhal v. Union of IndiaUnion of India v. Bharti Airtel Ltd.Federation of Hotel & Restaurant Association of India v. Union of IndiaR.K. Garg v. Union of IndiaTwyford Tea Co. Ltd. v. State of KeralaNitdip Textile Processors Pvt. Ltd.P. Laxmi Devi v. State of Andhra PradeshIndore Development Authority v. ManoharlalALD Automotive Pvt. Ltd. v. Commercial Tax OfficerHari Krishna Bhargav v. Union of IndiaJoseph Shine v. Union of IndiaCommissioner of Customs v. Dilip Kumar & Co.Sneh Enterprises v. Commissioner of CustomsVegetable Products Ltd.R.S. Raghunath v. State of KarnatakaUnion of India v. VKC Footsteps India Pvt. Ltd.
