The Supreme Court ruled that Section 438 of Criminal Procedure Code, 1908 cannot be invoked during CGST Act, 2017 Summons for recording statements.
Facts
a summons came to be issued dated 31.10.2018 to the respondents under Section 145 of the Central Excise Act, 1944 as made applicable to the service tax vide Section 83 of the Finance Act, 1994 and Section 70 of the Central Goods and Service Tax Act, 2017 calling upon them to remain present for the purpose of interrogation in connection with an inquiry against one M/s. Iyer Enterprise Mundra Kutch. The authority concerned wants to interrogate the respondents in regard to the alleged evasion of Goods and Service Tax Liability/Contravention of the Provision of the Finance Act 1994 and CGST Act 2017.
Submissions
Counsel appearing for the State of Gujarat pointed out that as many as 14 summons have been issued to one of the respondents. Only once, one of the respondents appeared for the purpose of interrogation.
Decision
The division bench of Justice J.B. Pardiwala and Justice Prashant Kumar Mishra said that it is a well-settled position of law that power to arrest a person by an empowered authority under the GST Act could be termed as statutory in character and ordinarily the writ court should not interfere with exercise of such power.
The bench observed that such power of arrest can be exercised only in those cases where the Commissioner or his delegatee has reasons to believe that the person has committed any offence specified in Clause (a) or Clause (b) or Clause(c) or Clause (d) of sub-Section (1) of Section 132 which is punishable under clause (i) or (ii) or sub-section (1) or sub-Section (2) of the said Section.
The bench said that as no First Information Report gets registered before the power of arrest under Section 69(1) of the CGST Act, 2017 is invoked and in such circumstances, the person summoned cannot invoke Section 438 of the Code of Criminal Procedure for anticipatory bail.
The court gave one more opportunity to both the respondents to appear before the authorities for the purpose of recording their statements and said that if the respondents fail to appear, then it shall be open for the authority concerned to proceed further in accordance with law.
Case title: The State Of Gujarat Etc. V/S Choodamani Parmeshwaran Iyer & Anr. Etc.
Citation: SLP(Crl.) No. 4212-4213 of 2019
