Who has the power to arrest?
Power to arrest, prior to conviction, is specified under Section 69 of the CGST Act, 2017. Such power can be exercised only by the Commissioner, viz., the Commissioner of central tax, the Principal Commissioner of central tax, the Commissioner of integrated tax, the Commissioner of State tax or the Principal Commissioner / Chief Commissioner of State tax, as defined under Section 2(24) ibid.
When can it be exercised?
The Commissioner should have reasons to believe that any of the following offences were committed, where the tax alleged to be evaded or ITC allegedly wrongly availed / utilised or refund allegedly wrongly taken exceeds Rs.4 crore:
- Goods / services supplied without issue of invoice, with intent to evade tax;
- Invoice / bill issued without supply of goods / services, resulting in wrongful ITC availment / utilisation or tax refund;
- ITC availed using fake invoice / without invoice;
- Tax collected but not paid to the Government beyond 3 months from the due date.
Similarly, the Commissioner can exercise the powers of arrest if he has reasons to believe that any offence specified u/s.132 ibid has been committed by a person who was earlier convicted of an offence u/s.132 ibid.
Procedure
The Commissioner can authorise any officer of central tax / state tax, as the case may be, to arrest.
If the tax alleged to be evaded or ITC allegedly wrongly availed / utilised or refund allegedly wrongly taken (in any of the four circumstances listed above) exceeds Rs.10 crore, such offences are cognizable and non-bailable. The officer shall inform the grounds of arrest to such person and produce him before a Magistrate within 24 hours.
In all other situations were a person is arrested pursuant to Section 69 ibid, he shall be admitted to bail or in default of bail, forwarded to the custody of the Magistrate. The Deputy Commissioner or the Assistant Commissioner shall, for the purpose of releasing an arrested person on bail or otherwise, have the same powers and be subject to the same provisions as an officer-in-charge of a police station.
