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1Scan for outdated or missing drivers - takes under a minute2Repair Windows errors before they cause bigger problems3Fix the driver behind crashes, sound loss and screen glitchesGST officers do not have an unrestricted power to search a business simply because they are investigating it. Section 67 of India’s Central Goods and Services Tax Act, 2017 (CGST Act) sets different conditions for an inspection and a search or seizure. The relevant decision must be made by a proper officer not below Joint Commissioner rank, who must have the statutory “reasons to believe”; when another officer is to carry out the action, written authorisation is required. Rules also prescribe forms and procedures, while the Act provides safeguards for seized records and goods.
Inspection and search are different powers
Section 67 uses “inspection” in subsection (1) and “search and seizure” in subsection (2). They are related but not interchangeable. A visit by officers is not automatically a search, and the powers available depend on which provision is being used and whether its conditions are met.
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| Question | Inspection: section 67(1) | Search and seizure: section 67(2) |
|---|---|---|
| Purpose and scope | Inspect a place relevant to specified suspected conduct under the Act. | Search a place where specified goods, documents, books or things are believed to be secreted; seize eligible items. |
| Threshold | A proper officer must have reasons to believe that one of the subsection’s statutory grounds applies. | A proper officer must have reasons to believe that goods liable to confiscation, or documents, books or things useful or relevant to proceedings, are secreted in a place. |
| Decision-maker | A proper officer not below the rank of Joint Commissioner. | A proper officer not below the rank of Joint Commissioner. |
| Action by another officer | The proper officer may authorise another central-tax officer in writing to inspect. | The proper officer may authorise another central-tax officer in writing to search and seize. |
| Potential result | Inspection of the relevant place; subsection (1) itself is not the seizure power. | Search and, where the conditions apply, seizure; if goods cannot practicably be seized, a prohibition order may be used. |
The Act’s “reasons to believe” and rank requirements matter: suspicion alone does not automatically establish authority for every search. Whether a particular operation met the requirements depends on its authorisation, facts and current law. CBIC’s FAQ describes inspection as a “softer” provision than search and says inspection requires written authorisation by an officer of Joint Commissioner rank or above. That is explanatory FAQ language; the statutory conditions and separate scopes are set out in section 67.
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Section 67(1) covers specified conduct by a taxable person connected with suppression, excess input tax credit, or contravention of the Act or rules with intent to evade tax. It also covers specified situations involving goods, accounts or storage by transporters, warehouse or godown operators, and others. The officer’s belief must relate to a ground stated in the subsection, not merely to a general desire to inspect a business.
What can support search and seizure?
Under section 67(2), the officer must have reasons to believe that goods liable to confiscation, or documents, books or things useful or relevant to proceedings under the Act, are secreted in a place. The officer may act personally or authorise another central-tax officer in writing. If goods cannot practicably be seized, the officer may instead order the owner or custodian not to remove, part with or otherwise deal with them without permission.
Authorisation, forms and inventory
CGST Rule 139 provides for FORM GST INS-01 when a proper officer authorises a subordinate officer to conduct inspection, search or seizure. For an actual seizure under section 67(2), the proper or authorised officer is to make an order in FORM GST INS-02. If seizure is not practicable, the rules provide FORM GST INS-03 for the prohibition order. The rules also require an inventory describing the items seized, including details such as description, quantity or unit, and make, mark or model where applicable; the person from whose custody items are seized signs it.
Prudent steps during an officer visit
- Note the names, designations and identifying details of the officers present.
- Ask to see the written authorisation and note its scope. If a copy is provided, keep it with the other case records.
- Keep copies of forms, seizure orders and inventories that are provided.
- Make a contemporaneous record of what was taken, sealed or made subject to a prohibition order, including item descriptions and quantities where possible.
- Preserve copies of business records and document any practical difficulty in accessing or copying them.
These are sensible record-keeping measures, not a guarantee that every document must be handed over at the scene or that disagreement over paperwork by itself invalidates an operation. The forms and inventory requirements do not resolve every operational dispute.
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Safeguards for seized records and things
Copies and extracts
A person from whose custody documents are seized is entitled to make copies or extracts in the presence of an authorised officer at the time and place indicated by that officer. The proper officer may restrict copying if, in that officer’s opinion, it could prejudice the investigation. This entitlement concerns seized documents and is subject to that stated restriction.
Return of material not relied on
Documents, books or things seized or produced that are not relied on to issue a notice under the Act or rules must be returned within a period not exceeding 30 days from the issue of that notice. This is not a general 30-day deadline for returning everything seized: the rule concerns material not relied upon and its clock runs from the notice, not from the date of seizure.
Retention while needed
Documents, books or things seized may be retained only for as long as necessary for examination, inquiry or proceedings under the Act. This retention rule is distinct from the 30-day return requirement for material not relied upon for a notice.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Safeguards and release routes for seized goods
Provisional release under Rule 140
Goods seized under section 67(2) may be provisionally released on the prescribed bond and security or, as applicable, payment of tax, interest and penalty. Rule 140 describes a bond for the value of the goods and a bank guarantee for the applicable tax, interest and penalty. The precise terms depend on the applicable rule and circumstances.
Perishable or hazardous goods under Rule 141
Rule 141 provides a separate route for release of seized goods or things that are perishable or hazardous in nature, on payment of the lower of their market price or the amount of tax, interest and penalty that is or may become payable. The rule also addresses possible disposal if payment is not made. This is a distinct procedure from the ordinary provisional-release bond and security route.
Six-month notice safeguard for goods
If no notice in respect of seized goods is given within six months of seizure, the goods must be returned. For sufficient cause, the proper officer may extend that period by up to a further six months. This deadline concerns notice in respect of seized goods; it is not a general six-month limit on an investigation or on retention of every seized document.
When can officers open or seal a device or receptacle?
Section 67(4) addresses a specific situation: access is denied, and the authorised officer suspects that goods, accounts, registers or documents are concealed in specified doors, almirahs, electronic devices, boxes or receptacles. In those circumstances the officer has power to seal or break open them. This is not an unlimited authority to access any device without the statutory condition. The Act also allows the officer to act where access to a place or receptacle is denied in the manner described by the subsection.
What to check if your premises or property is involved
A general guide cannot determine whether a specific search or seizure was lawful. That assessment depends on the written authorisation, the officer’s asserted statutory ground, what happened at the premises, the records made, and the law applicable to the case. For an actual operation, preserve the documents and timeline, identify which items were seized or restricted, and obtain advice from a qualified Indian GST professional or lawyer promptly, particularly where goods are perishable, business records are needed for operations, or a notice or release decision is pending.
The CGST Act and Rules provide the framework described above. CBIC’s online Act text contains section 67; an India Code-hosted Gazette PDF is useful for the original enactment but is not a substitute for checking amended current text. CBIC’s circular index lists search-operation procedural guidance dated 2 February 2021 and an instruction dated 25 May 2022 on deposit of tax during search, inspection or investigation. The index alone does not establish the detailed directions in those documents.
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