Delhi High Court | GST Searches Upheld Under Section 67 CGST Act But CCTV Footage Of Assessee’s Family Inadmissible | Violates Right To Privacy: Delhi High Court
Isabella Mariam
The High Court of Delhi Division Bench of Justice Prathiba M. Singh and Justice Shail Jain upheld the legality of searches under Section 67 of the Central Goods and Services Tax Act, 2017, but laid down safeguards for investigation. The Court directed that residential CCTV footage may be viewed only in the presence of family representatives and irrelevant material returned. It also held that any footage intruding upon family privacy cannot be used or disseminated, thereby ensuring due process and privacy rights in GST proceedings.
The petitions were filed by M/s Genesis Enterprises and related entities/individuals linked to members of the Gumber family, challenging the manner of search and seizure operations conducted by CGST officials at residential and business premises. The petitioners alleged improper recording of the residential panchnama, seizure of CCTV footage from the family residence in a manner infringing privacy, coercion to reverse input tax credit (ITC) and withdraw refund applications, and unlawful access to the business premises at 28, West Guru Angad Nagar, Delhi. They sought directions restraining use of the residential CCTV footage, de‑sealing of the business premises to resume operations, reversal of ITC entries alleged to have been made under duress, and other reliefs.
The respondents placed a note explaining the investigative steps and the basis for recording reasons to believe, including intelligence regarding refunds allegedly supported by non‑genuine supplier chains and discreet verification revealing absence of business activity at certain principal places of business. The note stated that digital storage devices—including CCTV memory cards—had been seized but not accessed, and would be opened only in the presence of the petitioners. With respect to the business premises, the respondents stated the search was conducted in the presence of two independent witnesses and a tenant who provided keys, that seized goods were handed over under INS‑02 and INS‑03, and that the petitioners had been offered provisional release under Section 67(6) read with Rule 140 of the CGST Rules. On the issues of refund withdrawals and ITC reversals, the respondents stated withdrawals occurred post‑inspection without communication with investigating officers and that one of the petitioners voluntarily offered to make payments; they disputed any coercion.
The Court noted that the petitions effectively sought intervention at the investigation stage and that counsel for the petitioners fairly submitted there was no allegation that the search was unauthorized. The Bench proceeded to examine Section 67 and relevant precedent and then addressed specific issues raised—privacy over residential CCTV footage, the manner of access to business premises, the mode of departmental communication, and allegations of coercion in payments/refund withdrawals.
The Bench recorded: “it cannot be held that the proceedings conducted under Section 67 of the Act were violative, or contrary to law. In fact, to unearth the alleged evasion, surprise inspection, search, and seizure was rightly resorted to by the GST Department.” The Court also recorded, with respect to the residential digital media, that “the said two memory cards have not been accessed by the GST Department.”
The Bench observed that “The Court is not convinced that the access to the business premises was unlawfully obtained, as is clear from the second panchnama… wherein the tenant who had a bunch of keys, had provided access to the officials of the GST department.” At the same time, it concluded that certain concerns warranted directions: “some of the concerns which are raised by the Petitioners such as right to privacy of the family being violated, etc., deserve to be addressed.”
On communications, after perusing email and WhatsApp chats on record, the Court recorded the need for prescribed modes of official communication, including proper identification of officials in emails and avoidance of WhatsApp except in exceptional circumstances or emergencies. Regarding allegations of coercion/duress in payments and withdrawals of refund applications, the Bench stated that a deeper examination would be required in appropriate proceedings given differing versions; it also recorded that any deposits and the withdrawn refunds would remain subject to the outcome of show cause notice proceedings, with the possibility of revival of refund applications if the petitioners succeed in adjudication.
The directed that “the hard disk, or any memory cards, which contain the CCTV footage of the residential premises, would not be accessed by the officials of the GST Department, except, in the presence of at least one member of the Gumber family, and one authorised representative.” It further directed that “After viewing the footage in their presence, if there is any relevant data that is required by the GST Department, only to that extent, the same would be copied. All the remaining footage would be returned to the Petitioners.”
Second, on access for searches at the business premises, the Court directed that “usually, the officials of the GST Department ought to ensure that the person who is being investigated, gives access to the premises that are to be searched. Taking access through a tenant who may be having keys of the premises, may not be permissible, unless it is with the knowledge of the person/entity being searched.” It clarified that “If the GST officials are of the opinion that the person being investigated is not providing access to the premises, then, after following the due process, in terms of Section 67(4) of the Act, after recording the requisite ‘reasons to believe’, the locks can be broken open, as per law.”
Third, on communications during investigation, the Bench directed that “All communications by the officials of the GST department, with the person/s or entities being investigated ought to be in the official prescribed mode. Whenever emails are sent, the name, and designation of the official ought to be mentioned, so that it can be properly traced back to the person who has sent the email.” Further, “Whatsapp communication… would not be usually permissible, unless there is an exceptional circumstance, or an emergency… Engaging in such Whatsapp communication, may, in fact, make the officials of the GST Department subject to various allegations, which ought to be avoided.”
Fourth, on allegations of coercion/duress and the status of deposits and withdrawals, the Court held that a deeper examination is required in the appropriate proceedings, stating that “the same would be subject to outcome of the Show Cause Notice proceedings. If in the Show Cause Notice proceedings, the Petitioners succeed, the refund applications would then be permitted to be revived by the Petitioners.”
The Court left other remedies open and recorded that no further relief was pressed in the writ petitions. It added that the GST Department is free to investigate other firms or individuals in accordance with law and clarified that observations in the order would not bind other proceedings or adjudication on facts, the Court having refrained from examining the factual allegations within the limited writ scope. The petitions, along with pending applications, were disposed of in these terms.
Advocates Representing the Parties:
For the Petitioners: Mr. Bharat Bhushan, Ms. Nidhi Gupta, and Mr. Anunay Mishra, Advocates.
For the Respondent (CGST Delhi East): Mr. Arun Khatri, Senior Standing Counsel, and Mr. Akash Panwar, Junior Standing Counsel, with Ms. Anoushka Bhalla, Ms. Tracy Sebastian, Mr. Sahil Khurana, Mr. Akshay, Mr. Hitesh Nandal, Mr. Pranav, and Ms. Shelley, Advocates.
Case Title: Genesis Enterprises v. Principal Commissioner CGST Delhi East & connected matters
Neutral Citation: 2025: DHC:8736-DB
Case Number: W.P.(C) 13821/2025 & connected matters
