Bombay HC Quashes GST Seizure of ₹1 Crore Cash, Rules GST Act Does Not Authorise Cash Seizure [Read Order]
The ruling underscores that seizure powers under the CGST Act cannot extend to cash, reinforcing the principle that enforcement actions must strictly adhere to statutory limits.
![Bombay HC Quashes GST Seizure of ₹1 Crore Cash, Rules GST Act Does Not Authorise Cash Seizure [Read Order]](https://images.taxscan.in/h-upload/2026/03/15/2129305-bombay-hc-gst-seizure-cash-rules-gst-act-cash-seizure-taxscan.webp "Bombay HC Quashes GST Seizure of ₹1 Crore Cash, Rules GST Act Does Not Authorise Cash Seizure [Read Order]")
In a recent ruling, the Bombay High Court has quashed the seizure of ₹1 Crore Cash Orders issued by the Directorate General of GSTIntelligence (DGGI), holding that cash cannot be seized under Section 67(2) ofthe Central Goods and Services Tax Act, 2017 (CGST Act). The matter arises from after officers of the DGGI conducted searches in June 2023 at the...
In a recent ruling, the Bombay High Court has quashed the seizure of ₹1 Crore Cash Orders issued by the Directorate General of GSTIntelligence (DGGI), holding that cash cannot be seized under Section 67(2) ofthe Central Goods and Services Tax Act, 2017 (CGST Act).
The matter arises from after officers of the DGGI conducted searches in June 2023 at the petitioner, Smurti Waghdhare’s office, residence, and her parents’ home, seizing ₹60 lakh from one premises and ₹40 lakh from another, totalling ₹1 crore.
The petitioner argued that Cash is not “goods, documents, books or things” under Section 67(2) of the CGST Act, and therefore cannot be seized, and the seizure orders lacked the mandatory reason to believe required by law.
It was also mentioned that no incrimination documents were cited, nor was any receipt issued under section 67(11).
On the other hand, the department stated that cash qualifies as a “thing” under Section 67(2), citing the Madhya Pradesh High Court’s ruling in Kanishka Matta v. Union of India. Also, statements of Chheda who was arrested in July 2023 in connection with a GST fraud investigation, revealed the use of multiple bogus firms and fake invoices, and the seized cash was suspected to be proceeds of tax evasion.
After concerning the matters, the High Court noted that Section 67(2) requires a proper officer to have recorded reasons to believe before seizing goods, documents, books, or things and in this case, no such reasons were recorded, and the seizure orders were perverse, arbitrary, and without authority of law.
The bench Justice G.S. Kulkarni and Justice Aarti Sathe held that the respondents were directed to forthwith release the total ₹1 crore to the petitioner, by transferring it directly to her bank account, along with applicable interest, within two weeks of receiving the order.
Accordingly, the writ petition was disposed of in these terms, with no order as to costs and clarified that its findings in this petition do not affect or reflect upon any pending or future income tax proceedings against the petitioner.
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