The court dismissed the habeas corpus plea, affirming the necessity of providing "reasons to believe" for arrests under the GST Act, while rejecting the demand for verbatim copies.
In a significant judgment, the Gujarat High Court has upheld the arrest of Keyur Jayendrabhai Patel in connection with alleged fraudulent activities under the Goods and Services Tax (GST) framework. The Division Bench comprising Justices Sangeeta K. Vishen and D. M. Vyas ruled on May 7, 2026, that the petitioner's arrest was legal and in compliance with the Central Goods and Services Tax Act, 2017, dismissing a habeas corpus plea challenging the procedure of arrest and subsequent remand.
The petitioner, represented through Jalpa Jayendrabhai Patel, contended that the arrest was illegal as the "reasons to believe," which are mandated by Section 69 of the CGST Act, 2017, were not provided in the exact form as recorded by the Commissioner. The petitioner argued that such non-compliance rendered the arrest unconstitutional and arbitrary.
The court, however, emphasized that while the "reasons to believe" must indeed be provided to the arrested individual to facilitate judicial review, the law does not mandate that these reasons be furnished verbatim as recorded by the Commissioner. The court found that the substance of the reasons was communicated effectively, satisfying the legal requirements.
The judgment further clarified that non-supply of verbatim copies does not violate statutory mandates as long as the essential elements and substance of the reasons align with the recorded motivations. The court underscored the importance of "reasons to believe" being based on material evidence that meets statutory conditions to prevent arbitrary arrests.
The court also addressed the maintainability of the writ of habeas corpus, reiterating that such a writ can challenge detention under judicial remand if there is non-compliance with statutory provisions or a lack of jurisdiction. However, it cannot contest the merits of a judicial remand order.
This decision is anchored in the principle that safeguarding personal liberty requires adherence to procedural safeguards, which in this case, were deemed to have been met by the authorities.
Bottom line:-
Goods and Services Tax (GST) - Arrest under Section 69 of the Central Goods and Services Tax Act, 2017 - Commissioner must record "reasons to believe" for arrest - The "reasons to believe" must be supplied to the accused, enabling them to challenge the arrest - However, the verbatim copy signed by the Commissioner is not mandatory, as long as the substance of the reasons is provided and not at variance.
Statutory provision(s): Central Goods and Services Tax Act, 2017 - Section 69, Section 132; Code of Criminal Procedure, 1973 - Section 167; Prevention of Money Laundering Act, 2002 - Section 19; Customs Act, 1962 - Section 104.
