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The Delhi High Court today observed that the entire concept of the Goods and Services Tax (GST) is getting defeated by the input tax credit while hearing a petition by a businessman seeking protection from arrest in a case of alleged wrongly/illegally availed of Input Tax Credit.
The petition has also challenged the vires of various provisions of the Central Goods and Services Tax Act, 2017.
The Court however granted him protection from arrest till the next date of hearing while also directing him to give cooperate in the investigation and to appear before the Deputy Director CGST as and when called.
A two-judge bench of Justice Manmohan & Justice Sanjeev Narula dictated in the order,
“It is agreed between the parties that the petitioners premises shall be searched tomorrow on Dec 10, 11AM in the authorised representatives of the petitioner. After preparations of ‘panchnama’ the residentially premises shall be de-sealed. The petitioner shall corporate in the investigation. We direct petitioner to appear before the Deputy Director CGST day after tomorrow 11 AM. For investigation & for recording of statement. He shall continue to appear as and when directed by the Deputy Director. Till the next date of hearing the petitioner shall not be arrested. List on 23rd.”
The Court was hearing the petition filed by Arun Gupta director of Transline Technologies Pvt Ltd. And challenged the Section 69 & 132 of the CGST Act, 2017, as unconstitutional and ultra vires to Article 21 of the Constitution of India and hence unconstitutional, illegal and unenforceable. Secondly, he sought directions to respondents to comply with the mandatory procedure under Chapter XII of the Code of Criminal Procedure, 1973 including Section 154, 157, 167, 172 etc for valid commencement of investigation into any offence qua the petitioner. There were certain other direction sought by the petitioner.
During the hearing today the Petitioners Counsel Advocate Vijay Aggarwal submitted When they (GST) officials come and examine me in my house they have sealed my house. I am not an absconder. Even if I am concealing something I will grant them access. It was not required for them to seal my house. They have sealed my Godown. Section 100 CrPC states, if you go for search you should have two respectable person from the locality. There is no search and seizure rule under the GST. There is a provision in CRPC and PMLA.
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