Supreme Court to Examine Jurisdiction of Police w.r.t. GST Authorities to Detain Goods in Transit [Read Order]

The issue of the case pertains to release of the goods which were seized by the police after registration of First Information Report.

On 16th July, 2025 apparently seeing that it was a case of evasion of tax, the Supreme Court had directed impleadment of the following:

(i) Commissioner of State GST, Directorate Commercial Taxes;

(ii) Principal Chief Commissioner, Directorate of Legal Affairs, Central Board of Indirect Taxes and Customs and

(iii) Additional Secretary, Goods and Service Tax Council.

Vide an order earlier, the Apex Court had stayed coercive action against the petitioners in connection with the FIRs.

The senior counsel for the petitioners, Sidharth Luhtra pointed out that the following two FIRs have been registered on the complaint of two of the petitioners. The submission is that aforesaid FIRs were registered under pressure. These are against unknown persons claiming that the Writ Petitions and the present petitions filed on their behalf were not authorised.

Siddharth Agarwal, senior counsel for the respondent State argued that on investigation, it was found that the documents on the basis of which the consignors and the consignees have been issued registration certificates under the Goods and Services Tax Act, 2017 (for short, “the GST Act”) were not found to be genuine.

Devashish Barukha, Senior counsel for the respondent State denied the allegations that FIR No.350 of 2025 dated 1st August, 2025 and FIR No. 523 of 2025 dated 28th July, 2025 have been registered under some pressure, however, he assured the Court that no further action shall be taken in these two FIRs without permission of this Court, while seeking a short adjournment to file further affidavit.

The bench of Supreme Court Justices Justice Rajesh Bindal and Justice Manmohan noted that, “As we had issued notice to the authorities under the GST Act, let counsel who is appearing for them apprise the Court on the next date of hearing about the status of registration of the consignor and consignee firms. Report besides other factors will apprise the Court as to whether the documents submitted at the time of registration were genuine and authentic. The place of business, the business being carried out by the firms ever since they were registered and the tax paid.”

The bench thus went onto mention that, ”As the issue which may be required to be considered in the present petition is regarding jurisdiction of the police authorities vis-à-vis the tax authorities to detain any goods in transit, we request Shri Tarun Gulati, learned senior counsel, to assist the Court as amicus.”

The matter was thus rescheduled to be listed on 19th of August, 2025.

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