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CA Final · Indirect Tax Laws · Inspection, Search, Seizure and Arrest

Rao Pharma, Hyderabad, had goods seized under section 67(2). It wants release on a provisional basis pending proceedings. Which of the following is a correct statement under the CGST Act?

Seized goods may be released provisionally either on execution of a bond with security in the prescribed manner and quantum, or on payment of applicable tax, interest and penalty. Release does not depend on final adjudication or any Magistrate's consent.

  1. ASeized goods can be released provisionally on execution of a bond and furnishing of security as prescribed, or on payment of applicable tax, interest and penaltyCorrect
  2. BSeized goods can be released only after the final adjudication order is passed
  3. CSeized goods can be released only on payment of tax, with a bond never being permitted
  4. DSeized goods can be released only if the Commissioner obtains a Magistrate's consent

Explanation

Section 67(6) provides that goods seized under section 67(2) shall be released on a provisional basis upon execution of a bond and furnishing of security, in the manner and quantum prescribed, or on payment of applicable tax, interest and penalty. Waiting for final adjudication or a Magistrate's consent is not required.

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