Officer unaware of GST Act Search and Seizure Provisions: Allahabad HC directs 3 Months Training and quashes Seizure Order [Read Order]

The Allahabad High Court has recently quashed a seizure order passed under the GST Act after finding that the concerned officer acted without understanding the law.

In M/s MLV Constructions v. State of UP, the Lucknow Bench comprising Justice Sangeeta Chandra and Justice Brij Raj Singh held that the Assistant Commissioner of State Tax, Mobile Squad-I, Lucknow, had violated Section 129(3) of the Central Goods and Services Tax Act, 2017.

The provision mandates issuance of notice to the owner of goods within seven days of detention or seizure and affording an opportunity of hearing before imposing penalty.

The dispute arose after goods belonging to MLV Constructions were seized on 21 June 2025. The officer proceeded ex parte against the driver and transporter, claiming that show cause notices were also issued to the consignor and consignee. However, when the Court examined the matter, it found no evidence of such notices being served. Instead, contradictory instructions were sent to the Chief Standing Counsel—first stating that notices were served, and later claiming that the officer presumed the owner would learn about the seizure through the driver.

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The Court observed that no notice was actually served on the petitioner. It noted that the officer concerned, Ramesh Kumar, admitted ignorance of the statutory provisions and had only recently been promoted. The Bench recorded that he “apparently does not know anything about the Act and perhaps even he has not read the provision under which he has taken the action”.

Taking note of the lapse, the Court directed the Commissioner, State GST, Lucknow, to ensure the officer undergoes three months’ training to become familiar with the provisions before being assigned to any seizure-related work.

On merits, the Court allowed the writ petition and set aside the impugned orders dated 27 June 2025 and 3 July 2025. It directed the authorities to issue a fresh show cause notice to the consignor/consignee within one week, mandating service through registered post, SMS, and email.

The assessee will be entitled to file a reply, and the authority must then pass a reasoned and speaking order after granting personal hearing if penalty is proposed.

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