The Punjab and Haryana High Court has ordered the immediate release of a Ludhiana businessman arrested by Central GST officers after he appeared before them on the Court's own direction, while his writ petition was still pending.

The Court called the arrest "a brazen act of highhandedness where the constitutional safeguards available to a citizen have not been adhered to."

A Division Bench of Chief Justice Ashwani Kumar Mishra and Justice Rohit Kapoor held that the arrest was "prima facie a violation of Article 21" of the Constitution and an attempt to overreach the pending court proceedings. It summoned the Principal Commissioner who authorised the arrest and the officer who issued the summons, and impleaded both in their personal capacity to explain their conduct.

"...the facts which have emerged before the Court would reveal that the respondents authorities considered the order of the Court as a charter to proceed in the manner, they deemed appropriate."

The court also observed that it intends to recommend disciplinary proceedings against Sugrive Meena, Principal Commissioner of CGST, Commissionerate, Ludhiana and Mohmad Saleem, SIO of CGST, Commissionerate, Ludhiana.

The petitioner, Kuldeep Goyal, is the Karta of an HUF that runs a business under the trade name M/s Ansh Steel Alloys, registered under the CGST/PGST Act, 2017. The firm had earlier filed CWP-18184-2026, challenging the attachment of its bank account on the ground that no show cause notice had been issued and no personal hearing given.

At the hearing on 22.09.2026, the revenue objected that the petitioner was not cooperating with the investigation. Senior counsel representing petitioner disputed this, stating that all documents had been produced and the petitioner had appeared before the authorities several times. He then undertook that the petitioner would appear before the authorities at 11:00 AM the next day. The Court recorded this and had directed the revenue to report the status of the matter on 29.09.2026.

The petitioner appeared at 11:00 AM on 23.09.2026. He was issued fresh summons under Section 70 of the CGST Act the same day and an arrest authorisation was issued. According to the petitioner, he was kept in the office through the day and night, and his arrest was shown at 4:45 AM on 24.09.2026. He filed the present petition through his wife, seeking to quash the arrest memo and the authorisation for arrest.

Senior Advocate N.S. Boparai, for the petitioner, argued that the petitioner had appeared and produced all the documents sought, in compliance with the Court's order. He pointed out that the summons of 23.09.2026 required appearance at 12:05 PM, although the petitioner had been present since 11:00 AM. He also pointed out that the Document Identification Number (DIN) cited in the summons was generated at 12:07 PM, two minutes after the time shown for appearance.

He argued that this amounted to manipulation of records and was contrary to the CBIC circular dated 23.12.2019 on DINs. He also argued that an arrest could not be made after sunset, and that detaining the petitioner from 11:00 AM and showing his arrest at 4:45 AM violated Article 21. He added that the arrest authorisation made no reference to the Court's order.

The revenue argued that the arrest was lawful because there was no order staying it and the petitioner's anticipatory bail plea had already been rejected. The Principal Commissioner and the officer who issued the summons appeared in the post-lunch session. They said the petitioner's statement was recorded after he appeared, and that he was arrested because his replies were evasive.

The Bench rejected the revenue's stand. It noted that the Court was already seized of the matter and had directed the petitioner's appearance to secure his cooperation.

It said the least that was expected of the authorities was to inform the Court of any development and "to proceed against the petitioner with the leave of the Court". It also recorded that at the hearing on 22.09.2026 it had dispelled the petitioner's apprehension of arrest, observing that the issue was sub-judice. The revenue's counsel, it said, was aware of these oral observations.

The Court found it "shocking" that the summons directed the petitioner to appear at 12:05 PM when he had been present since 11:00 AM. It found prima facie "manipulation" in the summons, since a DIN generated at 12:07 PM ought to have come before a 12:05 PM appearance time. It also noted that the petitioner had recorded on the summons that he was appearing in compliance with the Court's order. According to his counsel, the officers set aside the Court's order when it was shown to them.

The arrest authorisation gave three reasons to prevent the petitioner from committing any further offence under the CGST Act, to ensure proper and unhindered investigation and to prevent him from tampering with evidence or influencing witnesses.

The Bench held that these reasons were "wholly misplaced", since the petitioner was already before the authorities with all records and willing to cooperate under the Court's orders. It noted that the authorisation referred neither to the Court's orders nor to the petitioner's appearance, and that no document of the respondents did so.

This, it said, prima facie indicated "deliberate intent on the part of the officers to overreach the orders passed by the Court." It criticised "the routine manner" in which the authorisation was issued.

The Bench also noted that the Principal Commissioner, CGST, Chandigarh, had issued a circular dated 24.08.2026 on trade associations' grievances about enforcement proceedings, which suggested various safeguards.

The Bench said it was inclined to record the officers' conduct for examination by the disciplinary authorities, but would first give them a hearing. It impleaded Sugrive Meena, Principal Commissioner, CGST Commissionerate, Ludhiana, as respondent No. 5, and Mohmad Saleem, SIO, CGST Commissionerate, Ludhiana, as respondent No. 6, both in their personal capacity.

Both were issued notice to explain why observations recommending disciplinary action should not be made against them.

The Court directed the Chief Judicial Magistrate, Ludhiana, to release the petitioner forthwith. He must surrender his passport, not leave the country without the Court's permission, and inform the Commissioner of Police, with his whereabouts and mobile number, before leaving the district. The Court clarified that the release was purely an interim measure and not an opinion on the merits of the proceedings against him.

Case Title: Kuldeep Goyal v. Union of India and Others

Counsel: N.S. Boparai, Senior Advocate, with J.S. Bedi, Aakriti, Surya Pratap Singh, Ankit Jangra, Sumer Singh Boparai and Umang Goyal for the petitioner; Naman Jain, Senior Standing Counsel, for the revenue;

Sourabh Goel, Senior Standing Counsel, with Himanshi Gautam for respondent No. 4

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