The Delhi High Court has emphasized the importance of respecting the right to privacy of family members during GST searches. In recent cases, the court has issued guidelines and safeguards to ensure that taxpayers’ rights are protected during investigations.
Key Safeguards:
No Recovery During Search: No recovery of tax can be made during search, inspection, or investigation unless it is voluntary.
Voluntary Payment: Tax payment made during search cannot be considered voluntary if coercion or threat is involved.
Proper Adjudication Process: No coercive steps for recovery should be taken without following the adjudication process.
Protection of Attorney-Client Privilege: Advocate’s computers containing client data cannot be seized or accessed without strict safeguards, such as presence of advocate during inspection.
CCTV Surveillance: Statements during GST investigations must be recorded under CCTV surveillance, and legal counsel should be allowed to remain present in visual range during questioning.
Recent Cases:
Arvind Goyal CA vs. Union of India & Others: The Delhi High Court ordered the release of seized cash and silver bars, declaring the seizure illegal.
Baleshwari Devi vs. Additional Commissioner (Anti-Evasion), CGST Delhi North & Others: The court ordered refund of Rs 1.04 crore taken during GST search.
Puneet Batra vs. Union of India: The Delhi High Court ruled that an advocate’s CPU containing client data cannot be seized or accessed without strict safeguards.
Implications:
Protection of Taxpayers’ Rights: These guidelines ensure that taxpayers’ rights are protected during GST investigations.
Prevention of Coercion: The safeguards prevent coercive measures by tax authorities, promoting a fair and transparent investigation process.
Clarity on GST Enforcement: The court’s decisions provide clarity on GST enforcement and help prevent misuse of power by tax authorities.
These rulings highlight the court’s efforts to balance the government’s power to collect taxes with the need to protect taxpayers’ rights and prevent arbitrary actions. By upholding procedural fairness and due process, the court has set important precedents for GST enforcement.
