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Power to arrest is far more intrusive than the authority to investigate: SC
Supreme Court emphasizes that the power to arrest must be exercised cautiously, not mandated in every case where an investigation is necessary.
The Supreme Court on Wednesday stressed that the power to arrest is “far more intrusive and consequential” than the authority to investigate, reminding law enforcement agencies that the law does not mandate an arrest in every case where an investigation is necessary.
Highlighting the fundamental difference between the power to arrest and the power to investigate, a bench led by justice Sanjiv Khanna observed that while investigating authorities have the duty to uncover the truth, the power to arrest must be exercised with greater caution and discretion, besides being in complete adherence to the letter of the relevant statute.
“No legislation says that you must arrest in every case for conducting investigation. But when you exercise your right to make arrest, you must have the material to justify such actions...after all, the power of arrest is far more intrusive and consequential than the power to investigate,” remarked the bench, which also comprised justices MM Sundresh and Bela M Trivedi.
The court’s observations came as it reserved its judgment on a series of petitions related to arrests under the Central Goods and Services Tax (CGST) Act. States have corresponding provisions under the state GST laws.
Additional solicitor general SV Raju, appearing for the Centre and law enforcement agencies, defended the statutes empowering various officers to make arrests under the two laws, saying that the authority to make arrest under the GST Act arises from an officer having a degree of suspicion regarding the commission of an offence. The law officer said an arrest could be made when there is “more than suspicion” and “less than grave suspicion” with the latter standard of framing penal charges by a court of law.
But the bench seemed to differ. “Aren’t you suggesting standards which are not measurable? Why should we hinge on framing of charge? You can’t equate the right to arrest with framing of charges,” it commented.
The court added that it is not mandatory to arrest someone before an agency filed a charge sheet. “This court has held in a series of judgments that the right to arrest is different from the necessity to arrest,” said the bench, underscoring judicial prudence.
While Raju said that an arrest has to proceed on the subjective satisfaction of an arresting officer, the court emphasised that arresting officers must first apply the correct benchmark before assessing whether there is adequate incriminating material to justify an arrest.
“Subjective assessment must show that the officer has applied the right test -- whether the person has committed that offence and not it’s not just suspicion. When he sets the right benchmark then the question of materials would arise. If the principles are wrongly applied, the subjective satisfaction is bound to be wrong,” said the court, citing the language of Section 69 of the CGST Act that empowers the commissioner to arrest any person when she has reasons to believe that a person has committed an offence under the Act.
The bench added that the law does not require arrests to be made in every case where an investigation is conducted. “All adjudications cannot mean arrest,” it said.
Notices and arrests under the GST Act have increasingly become a source of concern and apprehension among taxpayers, who often find themselves navigating a complex and ambiguous regulatory landscape where the interpretation and implementation of the law vary from one jurisdiction to another and even among different tax authorities.
The CGST Act encompasses various provisions aimed at addressing tax evasion, fraudulent utilisation of Input Tax Credit (ITC), creation of fictitious identities for GST registration, and other unlawful activities. Notably, Section 67(1) empowers inspection, search, and seizure, while Section 69 grants authority for arrest. Section 70(1) pertains to summoning individuals to provide testimony and evidence. Section 132 delineates punishments, including imprisonment, while Section 135 addresses presumptions of culpable mental state, and Section 170 defines offences by companies.
These sections have faced legal challenges in the top court through a clutch of petitions. The petitioner primarily contends that Sections 69 and 70 of the CGST Act are unconstitutional, alleging that they exceed the scope of powers granted under Article 246A of the Indian Constitution. Additionally, it’s argued that powers of arrest and prosecution are not incidental to GST enforcement and that CGST officers lack the authority of police officers.
The petitions have further argued that summoned individuals are not afforded protection under Article 20(3) of the Constitution, which states that no person accused of any offence shall be compelled to be a witness against himself.
