Seizure Is to Secure and Identify, Not to Recover

Seizure Is to Secure explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

Seizure looks like collection. It is not. Understanding what the power is for decides what can properly be seized, for how long, and what a taxpayer may ask for while it lasts.

Under s.67(2), two categories may be seized: goods liable to confiscation, and documents or books or things which in the officer's opinion shall be useful for or relevant to any proceedings. The first is secured because it may later be confiscated under s.130; the second is taken because it is evidence. Neither purpose is recovery of tax. Recovery has its own chapter — s.79 — with its own modes and its own preconditions, and seizure is not one of them.

The two things that may be seized, and why

Goods liable to confiscation. Confiscation is dealt with by s.130, and it attaches to goods in defined situations. Seizure secures those goods pending the confiscation proceeding. If goods are not liable to confiscation, the first limb is not engaged. Section 130 confiscation →

Documents, books or things useful or relevant to proceedings. This limb is evidentiary. The purpose is to secure and identify material so it is available, unaltered, for the proceedings that follow.

The ICAI handbook puts the principle plainly: seizure is to "secure and identify". It is not a sanction, and it is not payment.

Seizure is not a form of recovery

Recovery under the Act means the modes in s.79 — deduction, detention and sale of goods belonging to the person, garnishee notices to third parties, distraint, certificate to the Collector, and application to a Magistrate.

Every one of those requires an amount payable — a determined liability that has not been paid within the period allowed. Section 78 requires that any amount payable under an order be paid within three months of service before recovery proceedings are initiated.

At the seizure stage:

• no notice has been issued;
• no liability has been determined;
• nothing is due;
• no period for payment has run.

So a seizure conducted, or continued, with the object of compelling payment is a use of the power for a purpose it does not have. The practical form this takes is familiar: goods are seized, and release is offered against payment of an unadjudicated figure. The correct answer is the statutory one — provisional release under s.67(6) and Rule 140, on a bond and a bank guarantee. Provisional release →

Seizure is not to prevent access

A business cannot operate without its records. It must file returns, pay tax, answer the very inquiry that produced the seizure, run payroll and meet obligations under other laws.

The Act recognises this in s.67(5): the person from whose custody documents are seized shall be entitled to make copies thereof or take extracts therefrom in the presence of an authorised officer, at such place and time as the officer indicates — except where making copies or taking extracts may, in the opinion of the proper officer, prejudicially affect the investigation.

The exception is narrow and is about prejudice to the investigation, not about convenience. A blanket refusal covering all seized material, in every case, does not engage it. Section 67(5) copies and extracts →

The related point is retention. The second proviso to s.67(2) requires that seized documents, books or things be retained by the officer only for so long as may be necessary for their examination and for any inquiry or proceedings under the Act. And s.67(3) requires the return within thirty days of the issue of a notice of documents, books or things not relied upon for issuing it. Section 67(3) →

Only the offending articles

Seizure attaches to what the section describes. It does not extend to:

• goods not liable to confiscation — for example, goods duly recorded, invoiced and accounted;
• documents of unrelated entities that happen to be at the premises;
• material of periods outside any conceivable proceeding;
• personal effects with no bearing on the inquiry.

Where an inventory shows items outside the two categories, the point should be made in writing at once, with a request for their return. It is a far better position than raising it a year later.

Omission to seize

The converse is also significant. Where an officer inspects or searches and does not seize particular material, the omission is itself a fact on the record.

It means the officer, having examined it, did not consider that material to be goods liable to confiscation or evidence useful or relevant to proceedings. Where a later notice relies on precisely that material — or asserts that records were unavailable, incomplete or unreliable — the omission to seize is a legitimate answer, provided the panchnama and inventory record what was examined.

Which is why the record made on the day matters so much, and why the panchnama should describe what was examined, not only what was taken.

What to ask for while a seizure subsists

1. A copy of the INS-02 seizure order and of the Rule 139(5) inventory, signed.
2. Custody under Rule 139(3), in writing, where the goods are bulky or perishable.
3. Copies and extracts under s.67(5) — specify the documents needed and why they are needed for ongoing compliance.
4. Provisional release under s.67(6) for goods, on a bond and bank guarantee.
5. Release under Rule 141 / INS-05 where the goods are perishable or hazardous.
6. Return under s.67(7) where six months pass from seizure without a notice — and check whether any extension was ordered, and whether it was communicated.
7. Return under s.67(3) of everything not relied upon, within thirty days of the notice.

Key takeaways

• Seizure secures goods liable to confiscation and preserves evidence. That is all it is for.
• Recovery runs under s.79, and requires a determined, unpaid liability — a seizure is not a recovery mode.
• Section 67(5) entitles the person to copies and extracts, subject only to prejudice to the investigation.
• Seized material must be retained only so long as necessary for examination and proceedings.
• Only the offending articles may be seized; unrelated or unconnected material should be returned.
• An omission to seize is evidence that the material was examined and not considered relevant.

Read next

• Rule 139 and the INS Forms: The Search and Seizure Procedure
• Section 67(5): Copies and Extracts of Seized Documents
• Section 67(6): Provisional Release of Seized Goods
• Spot Recovery During a GST Search Is Not Voluntary

Disclaimer: Positions stated as on 5 September 2026, based on the CGST Act and Rules as amended to 31 March 2026 (ICAI Bare Law, 12th edition) and the ICAI Handbook on Inspection, Search, Seizure and Arrest under GST (July 2025).