Bombay High Court

ABUBAKAR MINES AND MINERALS THR. PROP. FAROOQ BAIGversusTHE ADDITIONAL COMMISSIONER (AE) CGST KOLHAPUR AND ANR

Disposal: Disposed Off

Holding

The prohibition order under Section 67 ceased to operate after the prescribed period, rendering the continued detention unlawful, and the petition was allowed with an order for release of the goods.

Summary

The petitioner, Abubakar Mines and Minerals, challenged the continued detention of its goods under a prohibition order dated 26 September 2024 issued under Section 67(2) of the CGST Act. The petitioner argued that the detention persisted beyond the period allowed by Section 67(7) and sought a declaration that the order was invalid and an order for the release of the goods. The respondents contended that the prohibition order automatically expired after the prescribed three‑month period (or its six‑month extension) and that its expiry did not affect the legality of the investigation. The Court held that, as the respondents themselves admitted, the prohibition order ceased to operate after the expiry of the extended period, making the continued detention unlawful. Accordingly, the petition was allowed, the goods were ordered to be released, and the interim application was disposed.

Issues considered

Whether the continued detention of the petitioner's goods after the expiry of the period prescribed under Section 67(7) of the CGST Act is contrary to law.
Whether the expiry of a prohibition order under Section 67 affects the legality of the investigation and the evidentiary material collected.

Legislation cited

Central Goods and Services Tax Act, 2017 — s. 67(2), 67(7)
Central Goods and Services Tax Rules, 2017 — s. Rule 139(4)

Subjects

CGST Act
Section 67
prohibition order
goods detention
writ petition
release of goods

Judgment

33-WP-1943-2026.doc

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIRCUIT BENCH AT KOLHAPUR
CIVIL APPELLATE JURISDICTION

WRIT PETITION NO. 1943 OF 2026
WITH
INTERIM APPLICATION NO. 1140 OF 2026

Abubakar Mines and Minerals ...Petitioner.
Versus
The Additional Commissioner (AE)
CGST, Kolhapur and Another ...Respondents.
——————
Mr. Kuldeep Kulkarni for the Petitioner.
Mr. Anand Kulkarni with mr. Shridhar Patil (Through VC) with Mr. Vaibhav
Kupawade, for the Respondent Nos.1 & 2.
——————
Coram : Sharmila U. Deshmukh &
Neeraj P. Dhote, JJ.
Date : September 02, 2026.
P. C. :

1. By the present petition, the Petitioner seeks a declaration that

the continued detention and the prohibition on the Petitioner’s goods

pursuant to the order dated 26 th September 2024 is contrary to Section

67(7) of the Central Goods and Services Tax Act, 2017 (‘CGST Act’) and

seeks a direction of forthwith release of the Petitioner’s goods.

2. The Respondent Nos.1 and 2 have filed Affidavit-in-Reply dated

21st August 2026 and has stated in paragraph No.6 as under:

“6. I further say and submit that after passing of prohibition
order dated 26.09.2024 was issued in the Form GST INS-03 under
section 67 (2) read with Rule 139 (4) of the CGST Rules 2017
remained valid for the period prescribed under Section 67 (7) as

Gaikwad RD 1 of 3
33-WP-1943-2026.doc

mentioned by the petitioner in para No.2 and 4 (a) of the petition is
concern. I further say and submit that the initial Commissioner for a
period of 3 months in accordance with law. Upon expiry of extended
period, the prohibition order automatically came to an end, no
separate order was required to revoke the said prohibition, however
the petitioner seeks to portray the entire investigation as arbitrary
merely because the prohibition order ceased to operate under
Section 67 (7) of the Act. Such contention of the petitioner is wholly
misconceived. The expiry of prohibition order has no bearing on the
legality of the investigation conducted by the department or on
evidentiary material collected during the course of such
investigation.”

3. The above reproduced paragraph No.6 makes it clear that upon

expiry of the extended period, the prohibition order automatically

comes to an end. The relief, which is sought in the present petition,

assailed the continued detention after the order of 26 th September

2024, as violative of Section 67(7) of the CGST Act. As it is the

Respondents’ own contention that the prohibition order comes to an

end after the expiry of the extended period of six months, the petition

is required to be allowed in terms of prayer clause (a) and (b).

4. It is clarified that the passing of the present order permitting the

release of the goods in the petitioner’s favour, would have no bearing

on the legality of the investigation conducted by the Department or on

evidential material collected during the course of investigation.

Gaikwad RD 2 of 3
33-WP-1943-2026.doc

5. The Petition is allowed in terms of prayer clause (a) and (b).

6. The Interim Application does not survive and stands disposed of.

[Neeraj P. Dhote, J.] [Sharmila U. Deshmukh, J.]

Digitally
signed by
RAJU
RAJU DATTATRAYA
DATTATRAYA GAIKWAD
GAIKWAD Date:
2026.09.02
20:57:59
+0530

Gaikwad RD 3 of 3

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