GST Authorities Have No Power to Seize Cash – Calcutta HC in Puspa Furniture Case

Case Details: Puspa Furniture (P.) Ltd. vs. Union of India - [2025] 181 taxmann.com 822 (Calcutta)

Judiciary and Counsel Details

Om Narayan Rai, J.
Himangshu Kumar Ray, Subhasis Podder, Sushant Bagaria, Gaurav Chakraborty and Animitra Roy for the Petitioner.
N. Chatterjee, Tanoy Chakraborty, S. Sanyal, Bhaskar Prosad Banerjee, Ms. Hasi Saha, Abhradip Maity & Prithu Dudhoria for the Respondent.

Facts of the Case

The assessee was a private limited company. A search and seizure operation was conducted at the assessee’s office and residential premises. The proper officer found cash, which was sealed in the assessee’s premises and kept in the custody of the assessee himself. The assessee was unable to explain the source of such cash and thus, it was considered as unaccounted cash against the clandestine supply of taxable goods and services without any bill or invoice. A writ petition was filed to the Calcutta High Court contending that the GST authorities lack any power to seize any amount of cash. The GST authorities can seize goods or documents or books or things if they have reasons to believe that such goods or documents or books or things shall be useful or relevant to any proceeding under this Act and have been secreted in any place. It was not stated with any degree of conviction that the currency notes that had been seized shall be useful or relevant to any proceeding to be undertaken by GST Authorities against the petitioner or that the same could be correlated or traced to any transaction by the petitioner which respondent GST authorities were required to establish.

High Court Held

The Calcutta High Court held that money stands excluded from the purview of goods. The action of the respondent GST authorities in seizing cash and sealing the same in the custody of the petitioners is beyond the power domain of the GST authorities in the facts of the present case. Accordingly, the GST authorities were directed to forthwith de-seal the said amount so as to enable the petitioners to use the same in accordance with law.

List of Cases Reviewed

Commissioner of CGST v. Deepak Khandelwal [SLP NO. 18536 OF 2024, dated 19-08-2025] (supra)(para 21) followed

List of Cases Referred to

Bharatkumar Pravinkumar and Co. v. State of Gujarat [2023] 156 taxmann.com 136/100 GST 756/ 79 GSTL 28 (Gujarat) (para 9)
B. Kusuma Poonacha v. Senior Intelligence Officer [2024] 162 taxmann.com 414/87 GSTL 330 (Karnataka) (para 9)
Commissioner of CGST v. Deepak Khandelwal [SLP NO. 18536 OF 2024, dated 19-08-2025] (para 9)
Nand Kishore Gupta v. Additional Director General, Directorate General of GST Intelligence [2025] 171 taxmann.com 590/95 GSTL 313 (Delhi) (para 9)
State Tax Officer (IB) v. Shabu George [2023] 153 taxmann.com 138/99 GST 252/76 GSTL 145 (SC) (para 9)
Commissioner of CGST v. R.J. Trading Co. [2024] 160 taxmann.com 532 /103 GST 94/84 GSTL 113 (SC) (para 10)
Santosh Kumar Gupta v. Commissioner, Delhi GST [2024] 158 taxmann.com 226/102 GST 88/ 81 GSTL 341 (Delhi) (para 15)
Principal DIT (Investigation) v. Laljibhai Kanjibhai Mandalia [2022] 140 taxmann.com 282/446 ITR 18/288 Taxman 361 (SC) (para 15)
Narcotics Control Bureau v. Kashif (2024) 11 SCC 372 (para 15) and Pooran Mal v. Director of Inspection [1974] 93 ITR 505 (SC) (para 15).