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GST officers do not have an unlimited power to enter a business and take property. Their authority depends on the specific power being used, the statutory grounds, the officer who approved it and the written authorization. Under section 67 of the Central Goods and Services Tax (CGST) Act, an inspection is different from a search and seizure. Separate provisions cover goods in transit, arrest, summons and audit access.
This guide explains what a central GST officer may do, what records or goods can be restrained, the statutory copy and return rights, and the practical steps to take during and after an operation. Central and state GST laws are broadly parallel, but a live matter must be checked against the current central and applicable state law, rules, written orders and facts.
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The legal starting point: identify the power being used
The first question is not simply “Can GST officers do this?” It is “Which statutory power is being exercised?” The CGST Act separates several activities that can look similar on the ground:
- Section 67(1) inspection: entry and examination of specified business places when the statutory conditions and “reasons to believe” exist.
- Section 67(2) search and seizure: a search for suspected concealed confiscable goods or relevant books, documents or things.
- Section 68 transit inspection: verification of goods and prescribed documents or devices while a covered conveyance is moving.
- Section 69 arrest: a separate power for specified offences, subject to the Commissioner’s reasons to believe.
- Section 70 summons: a power to require attendance or production of evidence and documents in an inquiry.
- Section 71 access: access to a registered person’s premises for audit, scrutiny, verification and checks.
These powers have different triggers, paperwork and consequences. Calling every visit a “raid” can obscure important rights and deadlines.
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The current government-published compilation of the CGST Act and Rules, including sections 67–72, is available in the CGST Act and Rules Bare Law (November 2025). The official section text is also on the CBIC GST Act portal.
Who can authorize an inspection, search or seizure?
Section 67 uses a two-level structure. A “proper officer” not below the rank of Joint Commissioner must have the prescribed reasons to believe and may authorize another central tax officer in writing to conduct the operation. The field officer carrying out the inspection or search therefore acts under written authority; the statute does not describe a free-standing power for any officer to enter any business whenever desired.
“Reasons to believe” is a statutory threshold. It is not a magic phrase that automatically proves an operation lawful, nor does a person on site usually get to litigate the entire evidentiary basis in the middle of the operation. Ask to see the written authorization and note its date, issuing authority, premises and scope. Preserve a copy or photograph where permitted, and have counsel examine whether the authorization matches what was done.
What an inspection under section 67(1) permits
Inspection is aimed at examining places connected with suspected tax evasion or related contraventions. A Joint Commissioner or higher may authorize inspection when there are reasons to believe that circumstances such as these exist:
- Supplies have been suppressed.
- Excess input tax credit has been availed.
- There has been another contravention intended to evade tax.
- A person engaged in transporting goods, or operating a warehouse, godown or similar place, is keeping untaxed goods.
- Accounts or other practices at such a place are likely to cause evasion.
The officer may enter the relevant place of business and inspect stock, books, records, systems and the circumstances described in the authorization. The statutory categories matter: section 67(1) is not a general license to inspect unrelated private locations or material outside the stated legal purpose.
An inspection can lead to a later search, seizure, summons or demand, but those are separate steps with their own legal basis. Do not assume that an inspection order itself authorizes every possible action that follows.
What a search and seizure under section 67(2) permits
After an inspection or otherwise, a proper officer not below Joint Commissioner rank may act under section 67(2) when there are reasons to believe that either of the following is secreted in a place:
- Goods liable to confiscation; or
- Documents, books or things useful or relevant to proceedings under the Act.
The Joint Commissioner-level officer may search and seize personally or authorize another central tax officer in writing. The target is the place where the suspected goods or material are believed to be concealed. The power is therefore connected to the suspected items and proceedings, not an unrestricted entitlement to take every object found on the premises.
Opening doors, lockers and electronic devices
Where access is denied, the officer authorized under section 67(2) may seal or break open a door or a receptacle, including an almirah or electronic device, if the relevant goods, accounts, registers or documents are suspected to be concealed there. This wording should not be simplified to “officers can freely search any phone or computer.” The statutory authorization, the reasons to believe, the place and the denied-access condition remain important.
When physical seizure is impracticable
If goods cannot conveniently be physically removed, the proper officer or authorized officer may serve an order on the owner or custodian prohibiting removal, transfer or other dealing with them without prior permission. That is a legal restraint, not physical custody. Keep the restrained goods identifiable, segregated where possible and available for verification.
What may happen to books, records and devices
Officers may examine accounting records, registers, invoices, stock information, electronic data and other things that fall within the authorized purpose. If documents are taken from your custody, section 67 provides a right to make copies or extracts in the presence of an authorized officer at the indicated place and time. The proper officer may refuse that access only where making copies or extracts could prejudice the investigation.
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Ask for a detailed inventory or seizure memo identifying each document, device, book, account, storage medium and item. Record serial numbers, condition and the person from whose custody each item was taken. For electronic material, note whether the device itself was taken or whether data was copied, and retain available business-continuity backups without altering the original evidence.
Documents, books and things should be retained only as long as necessary for examination, inquiry or proceedings. Items not relied upon for issuing a notice must be returned within 30 days after that notice is issued. Where accounts, registers or documents are produced before officers under section 67(11), the officer must record reasons in writing for taking them and issue a receipt; retention is tied to the proceedings or prosecution.
Seized goods: release, notice and disposal timelines
Provisional release
Seized goods may be released provisionally on the prescribed bond and security, or on payment of applicable tax, interest and penalty, as the case may be. The exact amount and form depend on the goods, the applicable rules and the officer’s order. Request the written terms and keep proof of any bond, security or payment.
The six-month notice rule
If no notice concerning seized goods is issued within six months of seizure, the goods must be returned. For sufficient cause, the proper officer may extend that period by a further period of up to six months. Track the seizure date, the end of the first six-month period and any written extension; do not rely on an oral assurance that an extension exists.
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Perishable, hazardous or depreciating goods
The Government may prescribe disposal of specified goods that are perishable, hazardous, rapidly depreciating or difficult to store. Where goods fall within a prescribed disposal category, an inventory is required. Ask for the inventory, the applicable order and the proposed disposal process immediately because ordinary storage assumptions may not apply.
Inspection, search, transit checks and audit are not interchangeable
| Power | Typical trigger | What the officer may do | Paperwork and scope to check |
|---|---|---|---|
| Section 67(1) inspection | Reasons to believe suppression, excess input tax credit, an evasion-related contravention, untaxed goods or evasion-prone accounts at specified places. | Enter and inspect the relevant business, transporter, warehouse, godown or other specified place. | Written authorization from a proper officer not below Joint Commissioner; verify the premises and purpose. |
| Section 67(2) search and seizure | Reasons to believe confiscable goods or relevant documents, books or things are secreted in a place. | Search; seize material; in the statutory circumstances seal or open doors and receptacles; restrain goods when removal is impracticable. | Written authorization, search and seizure records, inventory, receipts and later notice or return dates. |
| Section 68 goods in movement | A covered conveyance is intercepted for verification. | Require prescribed documents or devices and inspect the goods in transit. | Transit documents and the applicable verification procedure; this is not automatically a section 67 search. |
| Section 71 access | Audit, scrutiny, verification or checks concerning a registered person. | Access business premises, records and computer material for the statutory purpose. | Access authority and audit or verification scope; distinguish it from seizure authority. |
| Section 70 summons | An inquiry requiring attendance, evidence or documents. | Require a person to attend or produce specified material. | Summons terms and attendance obligation; a summons is not itself a search warrant. |
| Section 69 arrest | Commissioner’s reasons to believe a specified section 132 offence has been committed. | Arrest under the separate statutory framework. | Arrest authority and safeguards; a search does not automatically authorize arrest. |
Do you have to pay tax during a GST search?
A search does not, by itself, create a rule that every business must pay an amount immediately. Statutory tax liability, a demand made through the applicable process and a voluntary deposit during an investigation are different concepts.
CBIC’s official index lists Instruction 01/2022-23 [GST-Investigation], dated 25 May 2022, titled “Deposit of tax during the course of search, inspection or investigation.” The index confirms the instruction’s title and date, but the operative directions should be read in the underlying document before relying on them. The same index lists Instruction 01/2020-21, dated 2 February 2021, on procedures during search operations. Both appear in the CBIC Circulars/Orders index; the 25 May 2022 instruction is also listed in the GST Council CGST Instructions index.
If an officer asks for a deposit, request the calculation, payment mechanism, receipt and the legal basis. Do not sign a statement you do not understand. Preserve challans, receipts, correspondence and any written explanation of whether money was paid as tax, interest, penalty or a deposit. Questions about coercion, refund, adjustment or challenge depend on the exact documents and current law, so obtain prompt professional advice rather than treating payment as an admission that closes every issue.
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- Designate one responsible contact. Notify the proprietor, director, authorized signatory and tax counsel. Keep staff from obstructing officers or independently handing over unrelated material.
- Request identification and authorization. Note officer names, designations, the issuing authority, date, premises and statutory section. Ask for a copy or permitted image of the written authorization.
- Clarify the operation. Ask whether the activity is an inspection, search and seizure, transit verification, audit access or execution of a summons. Use the answer to organize records and personnel.
- Facilitate lawful access without volunteering beyond scope. Do not destroy, hide, move or alter records. Identify privileged or personal material for counsel’s advice, and ask officers to record disputes about ownership or relevance.
- Maintain an evidence log. Record rooms entered, systems accessed, items copied or removed, seals applied, witnesses present and significant questions or answers. Keep a contemporaneous, factual log rather than arguing in it.
- Check every inventory and receipt. Compare descriptions, quantities, serial numbers, seals and condition before signing. Write specific objections on the document and obtain a copy.
- Request document access. Use the section 67 copy or extract procedure at the indicated place and time unless the officer records an investigation-prejudice reason for refusing.
- Protect business continuity. Ask how critical payroll, safety, customer-service and statutory records can be accessed without altering seized originals. Keep a list of systems or functions that have become unavailable.
- Secure the post-operation file. Store the authorization, panchnama or seizure memo, inventory, receipts, statements, notices, payment records and photographs in a read-only case folder with a dated index.
Common mistakes and how to avoid them
Assuming every visit is a search
An audit or inspection may have a narrower purpose than a section 67(2) search. Ask for the provision and authorization instead of relying on informal labels.
Signing an inaccurate inventory
A signature acknowledging receipt or the presence of goods is not the same as agreeing with every narrative statement. Read each page, correct factual errors in writing and retain a copy.
Ignoring the return clock
Mark the 30-day document-return rule after the notice is issued and the six-month goods-notice deadline from seizure. Follow up in writing and preserve delivery proof.
Confusing restraint with seizure
Goods under a no-removal order remain at the premises but cannot be dealt with without permission. Moving, selling or transferring them can create a separate problem; label and secure them.
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State GST enactments are substantially parallel, but amendments, delegations, forms and local practice can differ. A checklist cannot replace reading the actual authorization, seizure memo and applicable current law.
What to do after officers leave
Within the first day, create a chronology while memories are fresh, preserve CCTV and access logs, reconcile the inventory with accounting and stock systems, and identify missing devices or records. Ask counsel to review whether the operation stayed within the authorization, whether receipts and reasons were recorded, and whether any requested copies or releases remain outstanding.
Respond to summons and notices by their deadlines, but have answers and document productions reviewed for consistency. Do not backdate invoices, rewrite ledgers or “repair” files after the event. Preserve the original data and document any legitimate correction through the normal accounting and tax process.
For a live dispute, obtain advice that covers both central and applicable state GST law, because the facts, delegated authority, location and paperwork determine the available response. The CGST text and official instruction indexes linked above are starting points, not substitutes for case-specific legal advice.
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