2025 Supreme(Gau) 2334

THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Mitali Thakuria, J.
Shubham Jain, S/O. Lt. Sudesh Jain – Petitioner
Versus
Union Of India Rep By Additional Assistant Director, Directorate General Of Goods And Service Tax Intelligence – Respondent
Bail Appln. 962 of 2025
Decided On : 03-04-2025

Arresting authorities must communicate the 'reasons to believe' and grounds for arrest to the detainee. Failure to follow mandatory arrest protocols and procedural guidelines, as established in general criminal law, invalidates the arrest and justifies the grant of bail, even under special tax statutes.

Headnote:(A) Goods and Services Tax Act, 2017 - Sections 69 and 132 - Code of Criminal Procedure - Sections 41/41A and 50 - Bharatiya Nagarik Suraksha Sanhita, 2023 - Section 35(3) - Bail application - Non-compliance with mandatory arrest procedures - The statute is not a complete code regarding search and seizure, and the procedure prescribed under the general criminal code applies unless expressly barred. The failure to communicate 'reasons to believe' to the arrestee, effectively prevents them from challenging the legality of their arrest, violating personal liberty. (Paras 5, 7, 23, 25)

(B) Arrest - Procedural compliance - Absence of document identification numbers in authorization letters and grounds of arrest, combined with failure to serve 'reasons to believe' and disregard for guidelines governing the issuance of arrest summons, undermines the validity of the arrest and constitutes a valid ground for the grant of bail. (Paras 6, 10, 24, 25)

Facts of the case:
An application for bail was filed by a person arrested for allegedly supplying coal without the payment of applicable taxes and cess through dummy entities. The petitioner contended that the investigating authority acted mechanically, failed to follow mandatory arrest protocols, omitted document identification numbers in key documents, and did not communicate the recorded 'reasons to believe' to the detainee. Additionally, the petitioner asserted a 100% visual disability, rendering the alleged clandestine activities improbable. The respondent maintained that procedures were strictly followed and that the case involving economic offences warranted a stringent approach to bail.

Findings of Court:
The court observed that while the investigating authority recorded 'reasons to believe' as an internal document, the failure to communicate these reasons to the arrestee prohibited the exercise of their right to challenge the arrest. Furthermore, there was clear non-compliance with settled judicial guidelines regarding the issuance of notices prior to arrest. Given that the investigation had significantly progressed and relevant documents were seized, further custodial interrogation was deemed unnecessary.

Issues: The central issues were whether the non-communication of 'reasons to believe' and the absence of document identification numbers in arrest-related documents violated constitutional rights and whether the failure to comply with mandated arrest procedures entitled the accused to be released on bail.

Ratio Decidendi: Though the special tax enactment empowers the authorities to arrest, it does not override fundamental procedural requirements of the general criminal code. Because 'reasons to believe' are jurisdictional conditions justifying an arrest, their non-disclosure renders the detention legally vulnerable. Procedural safeguards, including the furnishing of grounds and reasons, must be strictly observed to protect against arbitrary deprivation of personal liberty.

Result: Bail application allowed. The petitioner is directed to be released on furnishing a bond with one surety to the satisfaction of the trial court, subject to conditions of cooperation and territorial restriction.