The Goods and Services Tax, 2017 was enacted to do away with multiplicity of taxes and their cascading effect and to bring uniform tax practice throughout India. This Act is further divided into the Central Goods and Services Tax Act, 2017, the State Goods and Services Tax Act, 2017 and the Integrated Goods and Services Tax Act, 2017. Under the new tax regime, goods and services are divided into 5 tax slabs i.e. 0%, 5%, 12%, 18% and 28%.
Chapter XIV of the Central Goods & Services Tax Act, 2017 deals with the procedure of inspection, investigation, search, seizure and arrest in case of suspected tax evasion. The power of the proper officer under Section 67 of the Act of 2017 for the purpose of the provisions of the Act do not take away the powers of police to investigate cognisable offences under sub-section (5) of Section 132 of the Act. Section 67 of the aforesaid act provides power to the proper officer, not below the rank of Joint – Commissioner to search, seize and inspect any business premises, on the basis of reason to believe regarding
Inspection can only be carried out by an officer below the rank of Joint Commissioner, when the concerned officer has an authorisation letter from the officer of a rank of Joint Commissioner or above.
The provisions of Code of Criminal Procedure relating to search and seizure shall be applicable in this act. There is no procedure mentioned in the act about how an investigation shall take place, hence, the provisions of section 100 of CrPC shall be applicable.
Section 129 of the CGST, 2017 gives power to a proper officer to detain goods of any conveyance, if he has the reason to believe that the transported goods are in violation of the provisions of the Act. Goods which are stored or are kept in stock but not accounted for can also be detained. Such goods and conveyance shall be released after payment of applicable tax or upon furnishing security of equivalent amount
The Commissioner of CGST /SGST can authorise any officer for arresting a person, if he has a reason to believe that the said person has been indulged in tax evasion of 2 crore rupees or more under GST as per the provisions of Section 131 and 132 of the Act.
All other rights as per the provision of CrPC and guidelines issued by the Hon’ble Supreme Court in D.K. Basu v. State of West Bengal reported in 1997 (1) SCC 41.