It has come to the notice of the Board and Central Vigilance Commission that proper procedure of search operation and/or guidelines for recording the panchanamas/statements have not been followed by the proper officer. Such non-compliance tend to weaken the Judicial Scrutiny of the case in the long run. Any non-compliance in carrying out a search operation may make the entire search invalid or can make any important evidence or statement invalid.
Therefore, the Central Board of Indirect Taxes and Customs (“CBIC”) has issued the instruction/Guidelines vide Instructions No. 01/2020-21 [GST-Investigation] dated 02.02.2021 wherein it is specified that instructions given under Central Excise Intelligence and Investigation Manual (2004) holds goods even under GST.
Section 18 of Central Excise Act, 1984 contains provisions related to search. It states that all the searches should be carried out in accordance with the provisions of code of criminal procedure, 1973. Corresponding provisions of search are given under Section 67 of the CGST Act, 2017.
Therefore, CBIC has instructed that following guidelines should be followed while performing search operation under GST:
1. Valid and justifiable Reason of Search
The proper officer should have valid and justifiable reasons to issue search authorization and such reasons must be duly recorded in file. Further, search can be carried out only with a proper search authorisation duly given by the competent authority. If a proper officer is not having valid search authorisation then the concerned person may refuse search operation.
2. Document Identification Number (DIN)
Instructions related to issuance of Document Identification Number (DIN) should be followed without any failure. Please note that Quoting of DIN on all notices is mandated with effect from 8th November, 2019. Any document issued without DIN shall be considered as invalid. (Circular No. 122/41/2019-GST dated 5ht November, 2020). DIN quoted on notice can be verified on https://esanchar.cbic.gov.in/DIN/DINSearch.
3. Search Warrant in the name of a relevant person
Search warrant is only valid to whom it is addressed and not any other person. Therefore, no search operation can be carried out where the warrant is issued for the premises of some other person. Further, When a search warrant has been issued in the name of a person who is already dead, in such a case authorised officer should report to the competent authority and get a new warrant in the name of the legal heirs.
4. Lady Officer in case of search operations
Lady officer should be part of the search team when the search is carried out of a residence.
5. Search in presence of proper witnesses
The search should be conducted in the presence of two or more independent witnesses preferably be the respectable inhabitants of the locality. In case no person from the locality wants to be the witness then persons from any other locality should be asked to be the witness. Further, In case of sensitive search then the PSU employees, Bank employees etc. may be included as witness of the search operation to maintain transparency and credibility. The witnesses should be enlightened about the purpose of the search and their duties.
6. Produce identity documents of Proper officer to the assessee
Before conducting the search of the premises, the proper officer should identify themselves by showing their identity cards to the person-in-charge of the premises. Also the personal search should be offered by the proper officers and witnesses before commencement of the search operations. After completion of the search, officers and witnesses should again offer themselves for their personal search.
7. Produce search authorisation to the person in charge
Before starting the search of any premises, the search authorization shall be executed and the same should be shown to the person in charge of the premises and such person should sign the search authorisation along with date. Signature of the witnesses along with date must be obtained on the body of search authorisation.
8. Panchnama for proceeding of the search should be made
A panchnama to show a truthful account of the proceedings of the search, should be made along with this the list of documents/goods/things recovered from premises. Further, following information must be recorded in panchnama without failure:
- Time and date of commencement and conclusion of search operation.
- Fact that proper officers and the witnesses offered personal search before commencement and after conclusion of the search proceedings.
- Each and every page of the Panchnama and Annexure should duly be signed by the officer authorizing the search.
- A copy of the punchnama along with all annexures should be given to the person-in-charge of the premises and acknowledgement may be taken from the person-in-charge.
- if he refuses to sign the panchnama then a copy of such punchnama may be pasted in a conspicuous place of premises in presence of the witness.
- Photographs of the punchnama pasted on the premises same may be kept as a record.
9. Videography of search proceedings in case of sensitive premises
Further, in case of sensitive premises, videography of search proceedings shall also be recorded and the same should be mentioned in panchnama.
10. General Duties of officer
While conducting the search, the officer:
- Must be thoughtful towards the assesses/party.
- The social as well as the religious sentiments shall be respected at all the time of the persons available at the time of search,
- Special care and attention should be taken to elderly, women and children present in the premises.
- Children must be allowed to go to school after examining their bags.
- A woman occupying any premises under search, has the right to withdraw before the search team enters, if according to the customs she does not appear in public.
- If any person in the premises is not well, a doctor may be called.
11. Opportunity to take copies of documents in case of seizure of any documents
If there are any documents to be seized then the person should be allowed to take copies or take extracts therefrom for this he may be given suitable time and place to take such copies or extracts. However, if a search officer is of the opinion that providing such copies and extracts may prejudicially affect the investigation, the officer may not provide such copies. If request to take copies is made during search proceedings then same be recorded in panchnama.
12. General Guidelines after completion of search operations
The authorization duly executed should be returned to the officer who has issued the search authorization along with outcome of the search.
- The name of the officers participated in the search operation must be mentioned on the reverse of the search authorization letter.
- If such authorization could not be executed with whatever reason the same should be mentioned on the back of the authorization and a copy of same should be given to the officer who has authorised search.
- Officers should leave the premises immediately after completion of panchnama proceedings.