Sanchayita Lahkar

The High Court of Delhi Division Bench of Justice Prathiba M. Singh and Justice Shail Jain directed that the Central Goods and Services Tax Department shall not access or download the contents of an advocate’s seized Central Processing Unit (CPU) without his presence and safeguards. The court permitted examination of the CPU but ordered that the process must take place in the presence of the advocate, designated lawyers, and IT officials of the Delhi High Court. The bench further restrained coercive measures against the advocate during the pendency of proceedings and clarified that the CPU should remain sealed after cloning and identification of relevant files.

The writ petition was filed by an advocate challenging the search and seizure carried out by the Anti-Evasion Branch of the CGST Delhi East at his office on 25 July 2025. The petitioner stated that he was engaged as legal counsel by a gaming company, M/s Martkarma Technology Pvt. Ltd., for handling GST filings, income tax returns, intellectual property registrations, and litigation matters. He asserted that he had withdrawn from representing the client after September 2024. Despite this, the GST Department conducted a search at the premises of M/s Bass Legal LLP, a firm run by his parents where he also worked, and seized various documents, partnership deeds, and a CPU containing 1250 GB of data.

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The petitioner contended that such action violated attorney-client privilege, as the materials seized included confidential client files unrelated to the investigation. He argued that under Section 67 of the CGST Act, 2017, the Department must have “reasons to believe” before undertaking such intrusive measures against an advocate. He also challenged the Department’s reliance on sealed cover materials without providing him an opportunity to rebut them, citing the Supreme Court’s judgment in Madhyamam Broadcasting Ltd. v. Union of India (2022).

The GST Department responded that the petitioner was not merely counsel but was actively involved in running the affairs of Martkarma Technology. They produced a sealed cover note and remand applications connected with the arrests of others in the same proceedings, and asserted that the seized CPU might contain relevant data evidencing his role. The Department argued that disclosure of certain witness statements would compromise the investigation, but maintained that there was prima facie material to justify the search.

The central dispute was whether the seizure of an advocate’s computer and files violated legal privilege and whether the Department could rely on undisclosed materials in sealed cover while investigating alleged GST evasion by the client company.

The Court observed: “GST officials ought not to be permitted to open the CPU or computer of any advocate without his presence and consent, inasmuch as the same could lead to serious breach of confidentiality and attorney-client privilege.”

It further stated: “Unless there are exceptional circumstances and subject to further orders that may be passed by the Court, if any advocate’s office is to be searched or computer is to be opened, the same ought to take place in the presence of the advocate and not otherwise.”

On the role of the petitioner, the Bench recorded: “At this stage, the Court refrains from making any observations in respect of the role of the Petitioner, or whether he was active in running the business of the client or not.”

Regarding the CPU, the Court noted: “The only direction that the Court is inclined to pass at this stage, without going into the merits of this matter, is to permit the CPU to be analysed by the GST Department, subject, however, to various precautions and conditions.”

On sealed cover practice, the Court stated: “It is Mr. Singla’s submission that revealing all the statements made by other persons under investigation could completely jeopardise the investigation. Such persons have clearly set out the active role played by the Petitioner, in running the affairs of the client.” At the same time, it acknowledged the petitioner’s reliance on Madhyamam Broadcasting, and directed that a redacted version of the affidavit be provided.

The Court recorded that the search had been conducted under Section 67(2) of the CGST Act, 2017, and that panchnama and photographs showed that officials accessed the petitioner’s computer. It stressed that safeguards were necessary to balance investigative needs with legal privilege.

The Court directed that the CPU of the petitioner be examined by GST officials only in the presence of specified persons, including the petitioner with two lawyers or a forensic expert, two senior IT officials of the Delhi High Court, and a forensic expert on behalf of the GST Department. It ordered that the CPU be connected and the following be determined: when the data was last accessed, what files were opened on 25 July 2025, and whether any files had been deleted, copied, or removed.

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“The entire hard drive of the CPU shall be cloned, and a cloned copy shall be given to the Petitioner.” Files relating specifically to M/s Martkarma Technology Pvt. Ltd. and associated entities were to be identified with the petitioner’s assistance and copied to the GST Department. The CPU itself would remain sealed in the custody of the Department, not to be accessed without further court orders.

The Court directed the Department to file an affidavit detailing allegations against the petitioner based on retrieved data, steps it intended to take, the petitioner’s role as revealed in statements (in redacted form), and the data determinations. A redacted affidavit was to be supplied to the petitioner’s counsel, while the full version would be shown to the Court.

It fixed inspection of the CPU for 11 and 12 September 2025, and directed payment of Rs. 1,00,000 each to the High Court IT officials by both parties. It clarified: “In the meantime, it is made clear that no coercive measures shall be taken against the Petitioner by the GST Department. The Petitioner shall only be present during the inspection of the CPU, to enable identification of files.”

The case was listed for further hearing on 30 October 2025

Advocates Representing the Parties

For the Petitioners: Mr. N Hariharan, Mr. Sachin Puri, Mr. Kirti Uppal, Mr. Avi Singh, Mr. Neeraj Malhotra & Mr. Amit Chaddha, Senior Advocates with Mr. Kunal Malhotra, Mr. Aman Sareen, Mr. Animesh Gaba, Mr. B C Pandey, Mr. Rajiv Taneja, Mr. Punya Rekha Angara, Ms. Vasundhara N., Mr. Aman Akhtar, Ms. Sana Singh, Ms. Vasundhara Raj Tyagi, Mr. Arjan Singh Mandla, Ms. Gauri Rama Chandra, Mr. Manish Dhankani, Ms. Ishan Parashar & Mr. Animesh Gaur, Advocates, along with the Petitioner in person.

For the Respondents: Mr. Rajesh Kumar, CGSPC with Mr. Abhishek Kumar Singh, Advocates for R-1; Mr. Aditya Singla, SSC, CBIC with Mr. Ritwik Saha, Ms. Arya Suresh Nair, Mr. Akhil Sharma, Ms. Shreya Lamba, Mr. Raghav Bakshi & Mr. Sahil Prashar, Advocates with Mr. Jyothiraditya, Additional Commissioner, CGST and Mr. Gajendra, Superintendent, CGST; Ms. Arunima Dwivedi, SSC, CBIC with Mr. Sainyam Bhardwaj, Advocate; Mr. Arun Khatri, SSC with Ms. Anoushka Bhalla, Ms. Tracy Sebastian, Mr. Sahil Khurana & Mr. Akshay, Advocates; Mr. T. Singhdev, Mr. Tanishq Srivastava, Mr. Abhijit Chakravarty & Ms. Yamini Singh, Advocates

Case Title: Puneet Batra v. Union of India & Ors.
Neutral Citation: 2025: DHC:7897-DB
Case Number: W.P.(C) 11021/2025
Bench: Justice Prathiba M. Singh, Justice Shail Jain