Access of Residential CCTV Footage for GST Cases: Important Delhi HC Guidelines that Businessmen cannot afford to Miss

The decision in Genesis Enterprises v. Principal Commissioner CGST Delhi East (2025 TAXSCAN (HC) 1914) has far-reaching consequences for businessmen and professionals who may be subject to GST investigations.

The controversy arose when the CGST Department carried out search and seizure operations against Genesis Enterprises, a business controlled by the Gumber family. On 22 July 2025, officials entered the family’s residence in Noida, where they seized electronic gadgets, documents and other devices. Two days later, summons were issued at Marengo Asia Hospital in Faridabad to Shri Vikas Gumber and partners of associated firms. Alleging that the Department had acted unlawfully, the assessee filed writ petitions before the High Court.

The petitioner argued that the search was carried out in violation of statutory requirements. It was alleged that the panchnama was incomplete, CCTV footage had been seized without safeguards, and payments as well as withdrawals of refund applications were made under coercion. It was also contended that the Delhi premises of Genesis Enterprises were unlawfully sealed. The assessee sought directions restraining the Department from using CCTV footage, reversing coercive payments, and de-sealing business premises.

The Revenue defended its actions by asserting that the family had created fake firms to fraudulently avail Input Tax Credit. Counsel for the Department submitted that refunds worth more than ₹4 crore had already been claimed and further applications for around ₹5 crore had been filed.

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These were allegedly supported by fake ITC and fraudulent transactions. It was further argued that intelligence inputs had revealed the concealment of documents and goods at the residential premises, providing lawful grounds for the search. The Department maintained that CCTV footage had not been accessed without safeguards and that the tenant of the Delhi premises had voluntarily handed over the keys. Provisional release of seized goods was also granted.

The Bench comprising Justice Prathiba M Singh and Justice Shail Jain examined the scope of powers under Section 67 of the CGST Act. The Court reiterated that officers not below the rank of Joint Commissioner may conduct search and seizure only if they record “reasons to believe” that tax evasion or fraudulent credit has occurred.

The statutory scheme allows officers to break locks if access is denied, seize documents and goods, and provisionally release them under Section 67(6). These powers, however, must be exercised in line with procedural safeguards drawn from the Code of Criminal Procedure.

The Court relied on earlier precedents to clarify the extent of these powers. In R.J. Trading Co. v. Commissioner of CGST (2021), it was held that jurisdictional facts must exist before search powers can be invoked. In Santosh Kumar Gupta v. Union of India (2023), the Court emphasized that “reasons to believe” must be rational and not arbitrary.

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In Deepak Khandelwal v. Commissioner of CGST (2023), the High Court observed that the purpose of Section 67 was to detect evasion, not to recover tax directly, and documents seized had to be returned once no longer required. The Supreme Court dismissed an SLP against this ruling. Similarly, in ITC Limited v. State of Karnataka (2025), the Court highlighted that due process and principles of natural justice must be observed during inspections.

Applying these principles, the Bench held that the GST Department had indeed recorded valid reasons to believe before initiating the searches. Intelligence inputs had connected five firms controlled by the Gumber family to suspicious refund claims, with no genuine business activity. The seizure of memory cards, electronic devices and documents from the residential premises was therefore lawful. The Court emphasized that these could only be accessed in the presence of the petitioner or an authorized representative, ensuring transparency. Business premises were searched with independent witnesses present, and seized goods were provisionally released to the tenant. The petitioners had withdrawn refund applications and made payments, but allegations that these were made under coercion required separate proceedings.

A significant part of the judgment dealt with the handling of residential CCTV footage. The Court made it clear that privacy could not be compromised without safeguards. It directed that CCTV footage from residential premises could only be accessed in the presence of a family member and an authorized representative, and only relevant data linked to the investigation could be copied. The Court further directed that communications from GST officials had to be official and traceable to prevent any misuse of authority.

In its final order, the Court upheld the legality of the searches while simultaneously ensuring that privacy safeguards were respected. Allegations of coercion and refund disputes were left open for adjudication in appropriate proceedings. The Department was allowed to continue with its investigations against the petitioner and related entities. The writ petition was disposed of with liberty to the assessee to pursue other remedies available in law.

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This judgment sends an important signal to the business community. The Delhi High Court has clarified that the powers of search and seizure under GST are extensive but not unchecked. While the Department is entitled to search residential premises if it records reasons to believe, the rights of taxpayers cannot be disregarded.

The guidelines on CCTV access mark a significant protection of individual privacy. For businessmen, the importance of maintaining proper records and ensuring that ITC claims are genuine is vital. At the same time, the decision provides assurance that privacy within residential spaces will not be violated arbitrarily

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