Commissioner Need Not Furnish “Reasons To Believe” U/S 69 CGST Act To Accused; Failure To Supply ‘Grounds Of Arrest’ Renders Remand Illegal: Allahabad High Court
The High Court held that while GST law requires the Commissioner to record “reasons to believe” before authorising arrest, there is no statutory mandate to supply those reasons to the accused; however, written grounds of arrest must be furnished along with the arrest memo, failing which custody becomes legally unsustainable.
The Allahabad High Court held that under the scheme of the CGST Act, the Commissioner must record “reasons to believe” based on material evidence before authorising arrest, but the statute does not require that such reasons be supplied to the accused.
At the same time, the Court ruled that failure to furnish written grounds of arrest to the arrested person, as mandated by binding departmental circulars and constitutional safeguards, vitiates the remand and renders detention illegal.
The Court was hearing a habeas corpus petition challenging the legality of the arrest and remand effected by officers of the Directorate General of GST Intelligence.
A Division Bench of Justice Siddharth and Justice Jai Krishna Upadhyay considered whether non-supply of “reasons to believe” and, while relying on the Supreme Court’s ruling in Radhika Agrawal Vs. Union of India (2025) observed: “…it is for the Commissioner to ascertain and record the 'reasons to believe' explicitly and with reference to the material and evidence underlying his opinion. It is not provided anywhere that the "reasons to believe" should be supplied to the accused”.
The Bench, while further relying on the same precedent, further held that the “grounds of arrest must be explained to the arrested person and also be furnished to him in writing as an Annexure to the arrest memo”, and that the failure to do so renders the remand order illegal.
Background
The petitioner was detained during search proceedings conducted under statutory powers and subsequently arrested under Section 69 of the CGST Act. He contended that although he was provided an arrest memo and search memo, he was not supplied the “reasons to believe” recorded by the Commissioner nor the written grounds of arrest.
The petitioner relied upon Supreme Court precedent and departmental circulars governing arrest procedure to argue that non-supply of these documents rendered his arrest unconstitutional and his continued custody illegal. The respondents, on the other hand, argued that the statute does not require the supply of “reasons to believe” and that all mandatory requirements had been complied with.
Court’s Observation
The Court first examined the statutory requirement under Section 69 of the CGST Act and the interpretation placed upon it by the Supreme Court in Radhika Agrawal. It held that the law clearly requires the Commissioner to independently ascertain and record reasons to believe, explicitly linked to material and evidence, before authorising arrest. The formation of such a belief must be objective and based on credible material rather than mere suspicion.
However, the Bench clarified that nothing in the statute or in the Supreme Court judgment mandates that these recorded reasons must be supplied to the accused. The obligation imposed by law is to record reasons, not to communicate them.
The Court drew a clear distinction between two separate legal requirements: recording reasons to believe, and furnishing grounds of arrest. While the former concerns the internal statutory satisfaction of the authority, the latter concerns constitutional safeguards protecting personal liberty.
Referring to paragraph 64.2 of the Supreme Court’s decision in Radhika Agrawal, the Court noted that the departmental circular dated 13 January 2025 mandates that grounds of arrest must be explained to the arrested person and also furnished in writing as an annexure to the arrest memo.
On examining the arrest memo in the present case, the Court found that it did not mention any annexure containing written grounds of arrest. There was nothing on record to show that such grounds had been supplied to the petitioner at the time of arrest.
The Court held that failure to comply with the department’s own binding circular amounted to procedural illegality. Since the requirement to furnish written grounds is a safeguard against arbitrary arrest, non-compliance affects the legality of the custody itself.
The Bench observed that when an arrested person is produced before a Magistrate for remand, the Magistrate must satisfy himself that statutory and constitutional safeguards have been complied with. If the arrest itself is procedurally defective, a remand order founded on such an arrest cannot be sustained.
Because the record did not show compliance with the requirement of furnishing written grounds of arrest, the Court concluded that the remand order was legally infirm.
Conclusion
Finding that this mandatory safeguard had not been followed, the Court declared the remand order illegal and granted relief to the petitioner, while leaving it open to the authorities to proceed afresh in accordance with law.
Cause Title: Jai Kumar Aggarwal v. Directorate General of GST Intelligence & Ors. (Neutral Citation: 2026:AHC:32796-DB)
Appearances
Petitioner: Sri Imran Ullah, Senior Advocate, assisted by Mohit Singh, Nadeem Murtaza, Vedant Gupta, Snigdha Singh, Harsh Vardhan Kediya, and Vineet Vikram.
Respondents: Dhananjay Awasthi, Gopi Krishan Soodh, Harmanpreet Singh (Senior Standing Counsel), and Manju Thakur, A.G.A.