Radhika Agarwal v. Union of India and Others

01 · Facts of the case and issues

A large group of writ petitions, appeals and connected proceedings questioned arrest powers under the Customs and GST statutes and the safeguards governing their exercise. The GST petitioners challenged the legislative competence to enact sections 69 and 70, contending that the power under Article 246-A to levy and collect GST did not extend to criminal enforcement. Other issues included whether arrest must await completion of tax assessment, whether criminal-procedure protections apply, the availability of anticipatory bail before an FIR, and allegations that tax payments were extracted by threats of arrest. The Customs challenges were considered against amendments enacted after Om Prakash, which had addressed the earlier statutory classification of offences. This common judgment resolved those legal questions; it did not set out and finally adjudicate every petitioner's alleged evasion, liability or entitlement to bail. The official file contains two opinions: a principal judgment signed by Chief Justice Sanjiv Khanna and Justice M.M. Sundresh, and a separate concurrence by Justice Bela M. Trivedi. Their paragraph numbering is independent.

Source: Principal judgment paragraphs 2-4, 48-60, 63, 69-78; official PDF pages 12-14, 40-48, 52-53 and 57-63. Trivedi J., paragraph 1, official PDF page 64 (separate opinion page 1).

02 · Discussion and reasoning of the Hon’ble Court

The principal judgment upheld legislative competence. Article 246-A supplies both the source of power and the field of GST legislation. Its broad scope extends to measures ancillary to effective levy and collection, including prevention of evasion, summons, arrest and prosecution. The challenge to sections 69 and 70 therefore failed. GST legislation is nevertheless not an exhaustive criminal-procedure code. Through sections 4 and 5 of the CrPC, ordinary procedural safeguards apply unless expressly or impliedly excluded by the special statute. Section 67(10) itself imports search-and-seizure procedure with the specified modification.

For GST arrest, the judgment first records the text of section 69(1), which refers to section 132(1)(a)-(d), punishable under clauses (i) or (ii), or section 132(2). It then focuses on cognizable, non-bailable offences under section 132(5): the specified (a)-(d) offences with the relevant amount exceeding Rs. 5 crore. It records Revenue's submission that arrests were made only in that non-bailable category. In that setting, paragraphs 56-59 require the Commissioner to record evidence-based reasons establishing the offence and its monetary threshold, supported by relevant and sufficient material and a reasoned computation. Suspicion or an unsupported assertion does not suffice; arrest cannot be used merely to investigate whether those statutory conditions exist. This account must be read with the wider text of section 69 reproduced in the judgment, rather than as an unqualified rewriting of all its clauses.

A completed assessment is not an invariable prerequisite. Where the offence and monetary threshold can be established with sufficient certainty from available material, the Commissioner may authorise arrest before a formal assessment order. Reasons must expressly connect the evidence to the statutory conditions, and the Commissioner and Magistrate must not ignore the benefit-of-doubt principle. Conversely, the existence of an arrest power does not make arrest routine or compulsory. The Court requires observance of the CBIC instructions, applicable CrPC protections and D.K. Basu safeguards. Those cover documented authorisation, arrest records, communication of grounds, notification of a nominated person, health and safety, and appropriate post-arrest procedure. The judgment records the January 2025 instruction requiring written grounds as an annexure to the arrest memo, with acknowledgement. It also applies the relevant Customs discussion to GST record-keeping, arresting-officer obligations and arrested-person rights.

The Customs analysis separately rejects the claim that customs officers are police officers and recognises the post-amendment offence classifications. It requires reasoned, material-based satisfaction, justification of monetary thresholds and written grounds before production before the Magistrate. The principal opinion applies the safeguards and judicial-review reasoning discussed in Arvind Kejriwal to Customs arrest and, in the specified respects, GST arrest. This includes scrutiny of statutory preconditions and the decision-making process, with reasons-to-believe disclosure subject to justified, court-supervised redaction in exceptional cases. Judicial review is not a mini-trial or an appellate assessment of the sufficiency of evidence. It can address absence of supporting material, perversity, lack of a rational connection, legal misdirection, irrelevant considerations or failure to consider relevant matters. The distinct Customs offence thresholds must not be imported into a domestic GST case.

Tax payment during inquiry must remain voluntary. Section 74(5) does not permit extraction of payment by threatening arrest. A taxpayer subjected to unlawful coercion may approach a court for refund, and departmental action against responsible officers is contemplated; the judgment does not itself award a refund to every petitioner. A section 70 summons does not, by itself, make the recipient an accused protected by Article 20(3). Anticipatory bail may be sought before an FIR if concrete facts provide a reasonable apprehension of arrest. The principal judgment expressly says contrary GST decisions identified in footnote 56 should not be treated as binding; this is its treatment of those decisions as at the judgment date.

Trivedi J. expressly agrees with the Chief Justice on when and how arrest powers should be exercised. Both opinions insist on authorised officers, material-based recorded belief and compliance with constitutional and statutory safeguards, and both reject merits reappraisal as judicial review. Her separate opinion places greater emphasis on judicial restraint: it excludes scrutiny of adequacy of material or correctness of factual belief at a nascent investigation stage, cautions against magnifying minor procedural lapses, and limits intervention to manifest arbitrariness or gross breach or non-compliance with safeguards. This is a difference in the stated scope and intensity of review, not a dissent from the validity of the arrest powers or from the need for safeguards. The two-judge principal opinion remains the majority account of the review principles; the narrower observations in the concurrence should not be presented as replacing it.

Source: Principal judgment paragraphs 13-29 (procedure and Customs), 30-47 (arrest review and written grounds), 50-62 (GST safeguards), 63-71 (coercion, summons, anticipatory bail and assessment), and 72-75 (competence); PDF pages 18-40, 40-52, 52-59 and 59-62. Separate opinion paragraphs 1, 4, 6-13; PDF pages 64, 66-67 and 68-76.

03 · Judicial decision and operative relief

The Court rejected the constitutional challenges and the challenge to the right of authorised officers under the Customs and GST Acts to arrest, subject to its explanation of the prerequisites and manner of exercising the power. The GST challenge to sections 69 and 70 on legislative competence was expressly rejected. The Court declined to examine section 135, concerning culpable mental state, because prosecution had not begun in the relevant cases; an aggrieved person could pursue an advised challenge before the High Court. Crucially, paragraph 78 directed the matters to be listed before an appropriate Bench in the week commencing 17 March 2025 for final hearing and disposal. The common judgment therefore did not finally dispose of every individual petition, uphold every impugned arrest, adjudicate tax demands or grant universal bail or refunds. Trivedi J.'s separate opinion added her judicial-review observations and did not substitute a different operative disposal.

Source: Principal judgment paragraphs 48, 75-78, PDF pages 40 and 62-63; Trivedi J., paragraphs 1 and 13, PDF pages 64 and 75-76.

04 · In favour of

In favour of the Union/Revenue on the constitutional validity of the challenged enforcement powers and against a universal rule that assessment must precede arrest. Taxpayers obtained authoritative clarification of enforceable arrest safeguards, protection against coerced recovery and the availability of anticipatory bail on a properly grounded apprehension even before an FIR. This is a mixed result on the common questions, with case-specific final hearing and disposal expressly left for a later Bench. The listing direction establishes the procedural position on 27 February 2025 only; it does not certify that any named petition remains pending today.

Source: Principal judgment paragraphs 56-62, 65, 67-70 and 75-78, PDF pages 46-52, 54-55, 57-58 and 62-63.