Indirect Tax Laws · Inspection, Search, Seizure and Arrest

Procedure after Arrest and Related Safeguards under GST

Updated 5 October 2026 · Fact-checked

After a GST arrest under section 69 of the CGST Act, the officer must tell the person the grounds of arrest and produce him before a Magistrate within 24 hours for a cognizable, non-bailable offence. For a non-cognizable, bailable offence, the person is released on bail, or sent to the Magistrate if he cannot furnish bail. Criminal procedure safeguards apply.

Understand Procedure after Arrest and Related Safeguards

Arrest is the most serious enforcement power under GST. It takes away personal liberty. So the law allows it only in narrow cases and adds safeguards. Examiners test both: who can order an arrest, and what must happen after it.

Start with the trigger under section 69(1). The Commissioner must have reasons to believe that a person has committed an offence specified in section 132(1) clauses (a) to (d), and that offence must be punishable under section 132(1)(i) or under section 132(2). The clause (a) to (d) offences are: supplying goods or services without invoice, issuing an invoice without supply, taking ITC without a proper invoice, and collecting tax and not paying it to the Government within the time allowed. The same ₹5 crore threshold applies to all four clauses, including clause (d). Under section 132(1)(i), the tax evaded or ITC wrongly availed must exceed ₹5 crore (₹500 lakh). Section 132(2) covers repeat-conviction cases. It forms part of the section 69(1) arrest trigger, but it does not make the offence non-bailable (see below). The Commissioner then authorises an officer of central tax to arrest by an order. The officer cannot arrest on his own.

Now the safeguards. The law splits offences into two groups. Under section 132(5), offences under section 132(1) clauses (a) to (d) that are punishable under section 132(1)(i) (tax above ₹5 crore) are cognizable and non-bailable. Clause (i) is the punishment tier, not a separate offence. For these, the officer must inform the person of the grounds of arrest and produce him before a Magistrate within 24 hours. The Magistrate then decides on custody or bail.

Section 132(4) covers the other offences under section 132, that is, offences not covered by section 132(5). These include the offences in clauses (e) to (l) of section 132(1), offences under clauses (a) to (d) in the lower tax slabs (tax of ₹5 crore or less), and the repeat-conviction cases under section 132(2). They are non-cognizable and bailable. So the split is not a tax-amount test alone: the clause and the punishment tier both matter. If such a person is arrested, he must be admitted to bail. If he cannot furnish bail, he is forwarded to the custody of the Magistrate. For releasing him on bail, the Deputy or Assistant Commissioner has the same powers as the officer in charge of a police station and is bound by the same provisions.

All of this operates subject to the general criminal procedure law on arrest (the Code of Criminal Procedure, 1973, now replaced by the Bharatiya Nagarik Suraksha Sanhita, 2023). That includes rights such as being told of the grounds and being produced before a Magistrate. In an answer, say that the GST provision is the special rule and general criminal procedure fills the gaps.

Key rules to remember

Who orders arrest: Commissioner has reasons to believe + offence under section 132(1)(a) to (d) punishable under section 132(1)(i) or section 132(2) → order authorising an officer of central tax to arrest; The Commissioner, having reasons to believe, authorises an officer of central tax to arrest by order. An officer cannot arrest without that order. Section 132(2) can trigger section 69(1), but the offence is still treated under section 132(4).
Cognizable and non-bailable offence (section 132(5)): Offence under section 132(1)(a) to (d) punishable under section 132(1)(i) (tax above ₹5 crore) → inform grounds of arrest + produce before Magistrate within 24 hours; The time runs from the arrest. Travel time to the Magistrate's court is usually excluded under general criminal procedure. Clause (i) is the punishment tier, not a separate offence. Do not add extra conditions in your answer.
Non-cognizable and bailable offence (section 132(4)): Other offences under section 132 (clauses (e) to (l), clause (a) to (d) offences in lower slabs, and section 132(2) repeat-conviction cases) → arrested person is admitted to bail; if he cannot give bail → forwarded to custody of Magistrate; Applies to offences other than those in 132(5).
Bail power of GST officer: Deputy or Assistant Commissioner = powers of officer in charge of a police station, for releasing on bail; This is why a bailable-offence arrestee need not wait for the Magistrate if bail is furnished.
Overriding framework: Section 69 operates subject to the criminal procedure law on arrest; Mention it to show that the safeguards are not limited to what section 69 spells out.

How to solve Procedure after Arrest and Related Safeguards questions

Use this order for any question on arrest under GST. It keeps your answer in provision, facts and conclusion form.

1Identify the offence from the facts: supply without invoice, invoice without supply, ITC without invoice, or tax collected but not paid. Note the amount of tax evaded or ITC wrongly availed.
2Check the arrest trigger. Section 69(1) applies to offences under section 132(1)(a) to (d), including tax collected but not paid, punishable under section 132(1)(i) (tax above ₹5 crore) or section 132(2). Apply the same ₹5 crore threshold to all four clauses.
3Check who authorised the arrest. The Commissioner must have reasons to believe and authorise an officer of central tax by order. If the facts show a self-initiated arrest by an officer, say it lacks authority.
4Classify the offence. Offences under section 132(1)(a) to (d) punishable under section 132(1)(i) (tax above ₹5 crore) are cognizable and non-bailable (section 132(5)). The other offences under section 132, such as clauses (e) to (l), the lower-slab offences under clauses (a) to (d), and section 132(2) repeat-conviction cases, are non-cognizable and bailable (section 132(4)), even though section 132(2) can trigger an arrest under section 69(1).
5Apply the correct procedure. For 132(5): inform grounds and produce before a Magistrate within 24 hours. For 132(4): grant bail, or forward to the Magistrate if bail is not furnished.
6Mention the bail power of the Deputy or Assistant Commissioner where the offence is bailable.
7Add the overriding point that criminal procedure law on arrest applies.
8State a clear conclusion in one line, answering what the question asked.

Quickest way: Two-box test: 132(5) or 132(4)

When to use it: Use this when the question gives a short fact pattern and asks what the officer must do after the arrest, especially in a 2 to 4 mark MCQ or short note.

Check the clause and the tax amount. An offence under section 132(1)(a), (b), (c) or (d) with tax above ₹5 crore (punishable under section 132(1)(i)) means Box 1 (cognizable, non-bailable). Anything else under section 132, including a section 132(2) repeat-conviction case, means Box 2 (non-cognizable, bailable).
Box 1 answer: tell the grounds, produce before a Magistrate within 24 hours.
Box 2 answer: bail; if no bail, forward to the Magistrate. Deputy or Assistant Commissioner has police-station-in-charge powers for bail.
Add one line: the arrest itself needed the Commissioner's order, and criminal procedure law applies.

Common mistakes in Procedure after Arrest and Related Safeguards

Saying any officer can arrest on suspicion.
Students remember the search power in section 67 and assume arrest works the same way.
Fix: Write that arrest needs the Commissioner's reasons to believe and an order authorising an officer of central tax.
Applying the 24-hour production rule to every arrested person.
The rule is easy to remember, so students apply it without checking the offence type.
Fix: Link 24-hour production to cognizable, non-bailable offences under section 132(5). For bailable offences, lead with bail and add the Magistrate only if bail is not furnished.
Forgetting to say the person must be told the grounds of arrest.
Students focus on the Magistrate and skip the first safeguard.
Fix: Always write both together: inform grounds, then produce before a Magistrate within 24 hours.
Mixing up the two categories: calling the high-value offences bailable.
Students confuse the tax-amount tiers with the bail rules.
Fix: Remember the pairing: offences under section 132(1)(a) to (d) punishable under section 132(1)(i) (tax above ₹5 crore) are cognizable and non-bailable (section 132(5)); the other offences under section 132, including section 132(2) repeat-conviction cases, fall under section 132(4) and are non-cognizable and bailable.
Ignoring who can grant bail.
Bail is thought to be only the Magistrate's function.
Fix: State that for bailable offences the Deputy or Assistant Commissioner has the powers of an officer in charge of a police station for releasing on bail.
Ignoring the general criminal procedure law.
Students read section 69 as a complete code.
Fix: Add one sentence that section 69 is subject to the criminal procedure law on arrest, so general safeguards also apply.

Worked examples

Example 1

Case: Mehta Traders issued tax invoices of ₹40 crore without any actual supply of goods and passed on ITC of ₹7.2 crore to buyers. The Commissioner, on the basis of investigation, recorded his reasons to believe that the proprietor, Mr. Mehta, had committed the offence, and authorised a CGST officer by order to arrest him. Mr. Mehta was arrested at 11 am on Tuesday. What procedure must the officer follow after the arrest?

Show the solution

Offence: issuing an invoice without supply of goods, which is an offence under section 132(1)(b).
Amount: the tax (ITC) involved is ₹7.2 crore, which is above ₹5 crore. So it is punishable under section 132(1)(i), which brings it within section 69(1), and it is a cognizable, non-bailable offence under section 132(5).
Authority: the Commissioner had reasons to believe and passed an order. So the arrest is validly authorised.
Procedure: the officer must inform Mr. Mehta of the grounds of arrest.
The officer must produce him before a Magistrate within 24 hours of the arrest, that is by 11 am on Wednesday (excluding travel time to the Magistrate's court as under general criminal procedure).
The criminal procedure law on arrest applies as well, so the Magistrate will then decide on custody or bail.

Answer: The officer must tell Mr. Mehta the grounds of arrest and produce him before a Magistrate within 24 hours, because the offence (tax above ₹5 crore) is cognizable and non-bailable under section 132(5).

Example 2

Case: Sharma & Co. took ITC of ₹1.5 crore on invoices without receiving any goods. A CGST officer from the investigation wing, acting on his own judgment and with no order from the Commissioner, arrested Mr. Sharma. Is the arrest valid? What would be the position for a person arrested for such a non-cognizable and bailable offence?

Show the solution

Offence: availing ITC on invoices without receipt of goods is an offence under section 132(1)(c).
Amount: the ITC involved is ₹1.5 crore, which is below ₹5 crore. So the offence is not punishable under section 132(1)(i), and it is not a cognizable, non-bailable offence under section 132(5).
Classification: the offence falls under section 132(4). It is non-cognizable and bailable.
Arrest power: section 69(1) is attracted only for offences under section 132(1)(a) to (d) punishable under section 132(1)(i) or section 132(2). At ₹1.5 crore, the arrest power under section 69 is not attracted.
Further defect: even where section 69 applies, arrest must be authorised by the Commissioner, who must have reasons to believe and authorise an officer of central tax by order. Here there is no such order, and an officer cannot arrest on his own judgment.
Position on bail (section 132(4)): the arrested person is admitted to bail. If he cannot furnish bail, he is forwarded to the custody of the Magistrate. For releasing on bail, the Deputy or Assistant Commissioner has the powers of an officer in charge of a police station.

Answer: The arrest is not valid. At ₹1.5 crore the offence is below the ₹5 crore threshold, so it is non-cognizable and bailable and the section 69 arrest power is not attracted. The missing Commissioner's order is a further defect. Mr. Sharma must be released on bail, or forwarded to the Magistrate if bail is not furnished.

Exam tips

In written answers, use provision, facts and conclusion form. Quote section 69 and section 132(5) or (4), then apply them to the clause and amounts in the case.
Always state the tax amount's role: for offences under section 132(1)(a) to (d), tax above ₹5 crore (punishable under section 132(1)(i)) leads to the cognizable and non-bailable path with the 24-hour rule. Apply this to clause (d) too.
In case-scenario MCQs, look for a trap: a missing Commissioner's order, a tax amount of ₹5 crore or less, or a delay beyond 24 hours.
Link this topic with section 67 (search and seizure) and section 132 (punishment). Questions often combine them into one case.
Write the bail power of the Deputy or Assistant Commissioner in one line. It is a small point that many students skip.

Practice questions from Inspection, Search, Seizure and Arrest

Procedure after Arrest and Related Safeguards: frequently asked questions

Who can order an arrest under GST?

The Commissioner can order it. When he has reasons to believe that a person committed an offence under section 132(1)(a) to (d) punishable under section 132(1)(i) or section 132(2), he authorises an officer of central tax to arrest by order. An officer cannot arrest on his own.

Within what time must an arrested person be produced before a Magistrate?

For a cognizable and non-bailable offence under section 132(5), the person must be told the grounds of arrest and produced before a Magistrate within 24 hours. Travel time is excluded under general criminal procedure.

What happens if the offence is non-cognizable and bailable?

The arrested person is admitted to bail. If he does not furnish bail, he is forwarded to the custody of the Magistrate. The Deputy or Assistant Commissioner can release him on bail with police-station-in-charge powers.

Does the criminal procedure law apply to GST arrests?

Yes. Section 69 works subject to the criminal procedure law on arrest, so the general safeguards apply along with the GST-specific rules.