SC Asks Centre To Reveal Data On GST Notices And Arrests

A special bench consisting of Justices Sanjeev Khanna, MM Sundresh, and Bela M Trivedi is reviewing a series of 281 petitions challenging different aspects of the GST Act, Customs Act, and the PMLA

The Supreme Court has directed the Centre to provide details on the issuance of notices and arrests made under the Goods and Services Tax (GST) provisions. The court intends to interpret the law and establish guidelines to prevent harassment and protect citizens' liberty.

A special bench consisting of Justices Sanjeev Khanna, MM Sundresh, and Bela M Trivedi is reviewing a series of 281 petitions challenging different aspects of the GST Act, Customs Act, and the Prevention of Money Laundering Act (PMLA). The bench expressed concern about the ambiguity surrounding section 69 of the GST Act, which pertains to the authority to make arrests.

The justices highlighted their commitment to "strengthen" personal liberties and prevent harassment of individuals. "Provide data on notices issued and arrests made under the GST Act for alleged defaults ranging from Rs 1 crore to Rs 5 crore in the past three years," the bench instructed Additional Solicitor General SV Raju, representing the Centre. The bench's request followed senior advocate Siddharth Luthra's claims of the potential misuse of GST authority powers, which he argued could limit personal freedoms.

During the hearing, Luthra raised concerns about the issuance of notices that threaten arrest as a form of harassment, even when arrests aren't always made. He stressed that arrests under the GST Act should follow the determination of the due amount from taxpayers.

Raju committed to gathering information on notices and arrests made under the central GST Act, although he noted that data from individual states might be more challenging to collect.

The bench insisted on receiving comprehensive data, including that available to the GST Council. The justices highlighted the need for distinguishing between fraud cases and inadvertent or innocent lapses.

Additionally, the bench plans to examine the issue of providing the grounds of arrest to individuals in writing, as mere verbal explanations may not meet the standards of natural justice. The justices referenced a previous ruling in a PMLA case, where providing written grounds of arrest to the accused was deemed mandatory.

The ASG will attempt to address the court's inquiries when the matter reconvenes on May 9.