Is Cash a “Thing” Under GST Section 67(2)? A Supreme Court Ruling Awaits
The Goods and Services Tax (GST) Act empowers officers to search and seize “goods, documents, books, or things” under Section 67(2). However, whether cash qualifies as a “thing” has been a contentious issue, with varying interpretations across High Courts.
This ambiguity will soon be clarified, as the Supreme Court prepares to rule on the matter.
🔍 What Does Section 67(2) of the GST Act Say?
Section 67(2) authorises GST officers to search and seize when they suspect tax evasion. Specifically, it mentions:
- Goods
- Documents
- Books
- Other “things”
The debate arises from whether “things” includes cash or is limited to items like electronic devices that store information.
Key High Court Rulings on Cash Seizure
🏛️ 1. Deepak Khandelwal Case (Delhi HC)
- Ruling: Cash cannot be seized under Section 67(2) unless it holds evidentiary value.
- Interpretation: “Things” should be interpreted as ejusdem generis (of the same kind) with “documents” and “books.”
🏛️ 2. Shabu George Case (Kerala HC)
- Ruling: Cash unrelated to business (e.g., wedding gifts) cannot be seized.
- Supreme Court: Upheld the Kerala High Court’s decision, dismissing the Revenue’s appeal.
🏛️ 3. Arvind Goyal Case (Delhi HC)
- Observation: Cash is not a “thing” for GST seizure unless it serves a specific purpose under the Act.
🏛️ 4. Bharatkumar Pravinkumar Case (Gujarat HC)
- Decision: Cash does not qualify as a “thing” for seizure under GST laws.
Why This Matters for Taxpayers
- Clarity on Seizures: A Supreme Court ruling will determine if cash can be seized during GST raids.
- Protection of Rights: Ensures that seizures align with constitutional safeguards.
- Business Impact: Confirms when cash held as stock-in-trade is subject to seizure.
What’s Next?
The Supreme Court’s decision could establish a uniform interpretation of Section 67(2). This will help eliminate uncertainties and ensure fair enforcement of GST laws.