Inspection, search and seizure under GST

By Registrationwala

2nd May 2017


Since the Indian Goods and Service tax is organized in a way for effective tax collection, depletion in corruption, and for the simple movement of goods etc. between inter-state. Therefore remembering the government anti-tax evasion scheme GST likewise has strict arrangements to assess and scan spots of business for suspected tax evaders.

What does Inspection and Search mean?


It basically involves an attempt to find or look through something and can only be done under proper and valid authority of law. In case of tax and legal cases it is an activity of a government official (which can be a TAX/Police officer depending upon the case) to go and look through or inspect watchfully and so on keeping in mind the end goal to discover something covered or to find evidence of a crime.


It is basically an act of examining something, often closely and is ordered by The Joint Commissioner of SGST/CGST (or an officer of higher rank) to any other officer of CGST/SGST (in writing). It is a gentler arrangement than search. It empowers officers to get to wherever of business of a taxable person and furthermore wherever of business of a man occupied with transporting goods or who is an owner/operator of a warehouse or go-down.

When can an order be proposed for Inspection under GST?

In the event that Joint Commissioner of SGST/CGST (or an officer of higher rank) "has reasons to accept" that in order to avoid tax any person has:-

1.  Hidden any transaction of supply

2.  Hidden any transaction of stock in hand

3.  Claimed Input Tax Credit in excess

4.  Violated any of the provisions

5. Any transporter or owner/administrator of a warehouse has kept goods which have gotten away tax payment or has kept records as well as goods so as to avoid tax

Which Business places can be inspected under GST?

Immediately after the authorization is given by the Joint Commissioner of SGST/CGST (or an officer of higher rank) to any CGST/SGST officer in writing, the inspection can be conducted at the following places

  • At any Business place of a taxable individual
  • At any Business place of transporter
  • At any Business place of an owner/operator of a warehouse

When can an order be proposed for Search under GST?

On the premise of after effects of inspection or some other reason, Joint Commissioner of SGST/CGST or a predominant officer  can, all alone or through an authorized officer can order, to look and seize the products and records  through a search if he believes that:-

1.There are goods which are liable for confiscation

2. Any documents or books or other things which will be useful during proceedings and are hidden somewhere

Seizure under GST

What is meant by the term “Seizure”?

Since the term Seizure has not been defined specifically in the revised GST Model Law but in common terminology it is defined as the act of taking control over something somebody by lawful process or force for example, the seizure of proof found at the scene of a crime. It for the most part suggests taking ownership forcefully against the desires of the owner/proprietor.

Difference between Seizure and Detention

Not allowing the owner any access to the seized goods by a legal order/notice is called detention. However, the ownership & possession of goods still lie with the owner. It is issued when it is suspected that the goods are liable to confiscation.

Seizure is taking over or actual possession of the goods by the department. But the ownership is still with the owner. Seizure can be made only after inquiry/investigation that the goods are liable to confiscation.

What happens if it is impossible to seize the goods?

On the off chance that it is not practicable to seize the goods, the best possible officer will arrange the owner/proprietor not to evacuate these goods without prior permission of the officer.

How long will the officer keep books/documents with him?

The officer will keep the books and records the length of it is vital for examination and inquiry. Different books which are not important to the issue of notice will be returned within 30 days from the date of notice.

What are the powers of the officer authorised to search?

The officer authorized to search will have the power to seal the entryway of the premises. He can likewise tear open the entryway of any premises if get to is denied. He can likewise break, open any almirah or box in which products, books, records and so forth are suspected to be disguised.

What occurs after seizure?

1. The individual, whose documents are seized, can make duplicates just within the sight of an officer of CGST/SGST.

2. The seized goods will be discharged, on a provisional basis, on a bond and outfitting of a security. Applicable tax, interest, and penalty will also have to be paid.

3. On the off chance that notice is not issued inside six months (extendable by 6 more months) of the seizing of the goods, they will be returned.

4. On the off chance that the products are risky or perishable or there is a lack of storage room then the Central or a State Government will advise the officer to discard the goods.

5. Such goods which are to be discarded will be recorded appropriately by the officer.

Different approaches to Check/Inspect

The Commissioner of CGST/SGST or an approved officer can buy any products or services from a taxable individual. This will be done to check the issue of tax invoices, regardless of whether they are looked after effectively, and whether GST sum is displayed clearly. At the point when the goods are given back, the amount will have to be refunded by the taxable individual and the sales invoice will be cancelled

 Arrest Under GST

If the Commissioner of CGST/SGST believes a person has committed an offence u/s 132, he can be arrested by any authorised CGST/SGST officer. The provisions of the Code of Criminal Procedure will apply to search and seizure.


Inspection, search and seizure under GST