Goel Metal v. Union of India
In favour of the revenue
The ruling in brief
M/s Goel Metal filed a writ before the Delhi High Court (W.P.(C) 10996/2026, decided 5 August 2026) following search and seizure under Section 67 of the CGST Act and a subsequent show cause notice alleging fraudulent input tax credit and use of fake firms. The petitioner argued that goods seized under Section 67(2) could be released only after determination of liability under Section 74A(9), that the phrase "on a provisional basis" in Section 67(6) was ultra vires where tax, interest and penalty were already paid, and that confiscation or penalty proceedings after Section 74A(9) closure lacked jurisdiction. The Division Bench explained that Section 67 addresses inspection, search, seizure and provisional release on bond or security, while Section 74A governs determination of unpaid, short-paid or erroneously refunded tax and wrongly availed ITC, and the provisions operate in separate fields. Provisional release under Section 67(6) is not contingent on Section 74A(9). The constitutional challenge was not sustained without proof of constitutional breach. On the show cause notice, the court permitted the petitioner to file a reply if advised. The petition was disposed of with observations that favoured the revenue's reading of the statute.
For information only — not legal advice. Read the full judgment and applicable law before relying on this summary.
Provisions considered
- CGST S.67 — Power of inspection, search and seizure.
- CGST S.74A — Section 74A of the Central Goods and Services Tax Act, 2017.
Source documents
Similar rulings
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