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Case Details
H L Cargo Parcel Services v. Superintendent/Appraiser Senior Intelligence Officer
W.P.(C) 3469/2025, Delhi High Court, decided on 30-04-2025.
Case: M/s India Steels Sales Thru. Proprietor Raish Bano v. State of U.P. & Others
Citation: Writ Tax No. 802 of 2025
Court/Bench: Allahabad High Court (Lucknow Bench)
Coram: Hon’ble Pankaj Bhatia, J.
Date of Decision: 27-08-2025
Issue
Whether seizure of cash, gold, and silver by RPF without seizure memo or notice was valid, and whether goods should be released.
Whether orders under section 74 of the CGST/UPGST Act, based on an SIB survey report not supplied to the assessee, are sustainable; and whether the consequential order noting dismissal on limitation can survive.
Facts
- Goods of the petitioner were intercepted at New Delhi Railway Station in Rajdhani Express.
- RPF seized ₹85.72 lakh cash, 498 gm gold (₹36.70 lakh), and 365.704 kg silver (₹27.95 crore).
- No seizure memo or show cause notice was issued post-seizure.
- Goods were handed over: silver to GST Department, gold and cash to Income Tax Department.
- Petitioners sought quashing of seizure and release of goods.
- Proceedings under section 74 were initiated relying on an SIB survey dated 13-01-2021; the survey report was not furnished to the petitioner.
- An order under section 74 was passed on 16-01-2025; a subsequent order dated 25-07-2025 recorded dismissal as time-barred.
- The petitioner contended that section 74 could not be invoked absent material indicating fraud, wilful misstatement or suppression.
Held
The Court noted that investigation by GST and Income Tax authorities is ongoing. It directed that both Departments must issue notice of proceedings to the petitioner, allow them to seek release under Section 129 or 67 of CGST Act or under the Income Tax Act, and ensure no disposal of goods until proceedings conclude. Any release application must be decided within three months. The Court did not examine the merits of the seizure.
It was held that non-supply of the foundational SIB survey report vitiated the adjudication, offending principles of natural justice. Consequently, orders dated 16-01-2025 and 25-07-2025 were quashed. The matter was remanded to the assessing authority to supply the survey report, permit a reply, grant a hearing, and pass a fresh order in accordance with law.
Ratio / Key Principle
Where goods seized are in custody of multiple authorities, proper notice and adjudication are mandatory, and release applications must be considered within a time-bound framework.
Adjudication under section 74 based on undisclosed material is impermissible; all adverse material relied upon must be furnished to the assessee before decision.
Suggestion for Professionals / Businesses
Businesses handling high-value consignments of cash, bullion, or precious metals must maintain proper transport documentation and ensure GST and income disclosures are compliant. In case of seizure, stakeholders should promptly file applications under relevant GST or IT provisions, as authorities are now bound to issue notices and decide release applications within a fixed period, reducing prolonged uncertainty.
Where notices or orders refer to surveys/inspection reports, demand complete copies and record objections if not supplied. File preliminary responses highlighting non-supply and seek inspection before the hearing. Maintain a documented trail of requests and reminders to mitigate the risk of orders based on undisclosed material.
