SUB GST p2.5

Cognizable and non-cognizable offense and power to arrest under GST

22 May 2020

Meaning of cognizable offense.

Generally, cognizable offense means a serious category of offenses in respect of which a police officer has the authority to make an arrest without a warrant and to start an investigation with or without the permission of a court. 

Meaning of non-cognizable offense.

non-cognizable offense means relatively less serious offenses in respect of which a police officer does not have the authority to arrest without a warrant and an investigation cannot be initiated without a court order.

Cognizable and non-cognizable offenses under the CGST Act.

It is provided that the offenses relating to taxable goods and /or services where the amount of tax evaded or the amount of input tax credit wrongly availed or the amount of refund wrongly taken exceeds Rs. 5 Crore, it shall be cognizable and non- bailable and in such cases, the bail can be considered by a Judicial Magistrate only. Other offenses under the Act are non-cognizable and bailable and all arrested persons shall be released on bail by Deputy/ Assistant Commissioner.

Precaution is taken during the arrest

The provisions of the Code of Criminal Procedure, 1973 relating to the arrest and the procedure thereof must be adhered to in all situations amounting to arrest. It is, therefore, necessary that all field officers of CGST be fully familiar with the provisions of the Code of Criminal Procedure, 1973. 

One important provision to be taken note of is Section 57 of Cr.P.C., 1973 which provides that a person arrested without a warrant shall not be detained for a longer period than, under the circumstances of the case, is reasonable but this shall not exceed 24 hours (excluding the journey time from a place of arrest to the Magistrate’s court). Within this period, as provided under section 56 of Cr.P.C., the person making the arrest shall send the person arrested without a warrant before a Magistrate having jurisdiction in the case.

Guidelines for arrest 

The decision to arrest needs to be taken on case-to-case basis considering various factors, such as, nature and gravity of the offense, the quantum of duty evaded or credit wrongfully availed, nature and quality of evidence, the possibility of evidence being tampered with or witnesses being influenced, cooperation with the investigation, etc. Power to arrest has to be exercised after careful consideration of the facts of the case which may include:

• to ensure proper investigation of the offense.

• to prevent such people from absconding.

• masterminds or key operators affecting proxy/ benami imports/exports in the name of dummy or non-existent persons/IECs, etc.

• masterminds or key operators affecting proxy/ benami imports/exports in the name of dummy or non-existent persons/IECs, etc. 

• where the intent to evade duty is evident and an element of men’s rea/guilty mind is palpable; 

• prevention of the possibility of tampering with evidence.

• intimidating or influencing witnesses and

• large amounts of evasion of tax.

Safeguards for a person who is placed under arrest

There are certain safeguards for a person who is placed under arrest. These are: 

1. If a person is arrested for a cognizable offense, he must be informed in writing of the grounds of arrest and he must be produced before a magistrate within 24 hours of his arrest.

2. If a person is arrested for a non- cognizable and bailable offense, the Deputy/ Assistant Commissioner can release him on bail and he will be subject to the same provisions as an officer-in-charge of a police station under section 436 of the Code of Criminal Procedure, 1973.

3. All arrests must be in accordance with the provisions of the Code of Criminal Procedure,1973 relating to arrest.