Customs and GST Arrest Powers Valid, But Officers Must Record Reasons to Believe and Give Written Grounds

A batch of writ petitions, appeals and connected cases questioned the power of customs and GST officers to arrest, and the validity of Sections 69 and 70 of the GST Acts (Khanna CJI, paras 2, 72). The petitioners relied on Om Prakash (2011), which had held Customs Act and Excise Act offences non-cognizable, so officers needed a Magistrate's warrant to arrest (Khanna CJI, paras 2-3, 22). Amendments of 2012, 2013 and 2019 made specified customs offences cognizable and non-bailable (Khanna CJI, paras 8, 10-11). The petitioners also said assessees were coerced into paying tax under threat of arrest (Khanna CJI, para 63).

Customs officers are not police officers (Khanna CJI, paras 15-16). After the amendments, reliance on Om Prakash was no longer valid (Khanna CJI, para 22). Sections 41-B, 41-D, 50A and 55A of the Code apply to customs arrests, and officers must keep records (Khanna CJI, paras 23-28). Section 104(1) of the Customs Act carries safeguards similar to Section 19(1) of the PML Act, so the Arvind Kejriwal principles apply (Khanna CJI, paras 40-41, 46). The 'reasons to believe' standard is higher than mere suspicion, and the reasons must show how the monetary thresholds are met (Khanna CJI, paras 43-44). Grounds of arrest must be given in writing (Khanna CJI, para 47). Under the GST Acts, the Commissioner must record reasons, based on material, that a cognizable and non-bailable offence under Section 132(5) is made out; arrest cannot be made merely to investigate (Khanna CJI, paras 56-57). Tax cannot be extracted under threat of arrest, and coerced assessees may seek refunds (Khanna CJI, paras 67-68). Trivedi J. added that courts should review such arrests only for compliance with the safeguards (Trivedi J., paras 9, 13).