Short answer: Only when the Commissioner has reasons to believe, based on material, that the person has committed one of the specified offences in Section 132(1)(a) to (d) of the CGST Act. High Courts have also required the Commissioner to record why arrest is necessary. Offences involving more than Rs 5 crore are cognizable and non-bailable. The arrest order must be communicated before arrest, and grounds must be given in writing. The GST Council has recommended omitting Section 69, but it remains law until amended.
What the statute says
Section 69(1) allows the Commissioner, where he has reasons to believe that a person has committed an offence under clauses (a) to (d) of Section 132(1), to authorise an officer to arrest that person. These clauses cover supplying goods or services without an invoice to evade tax, issuing invoices without supply, availing input tax credit wrongly on such invoices, and collecting tax but not paying it to the Government. Under Section 69(2), the person must be informed of the grounds of arrest and produced before a Magistrate within 24 hours.
As explained in Radhika Agarwal v. Union of India, these offences are cognizable and non-bailable under Section 132(5) where the amount exceeds Rs 5 crore. The Rs 2 crore and Rs 1 crore figures in Section 132(1) are punishment slabs, not the threshold for this classification.
What the Supreme Court required in Radhika Agarwal
In its judgment of 27 February 2025, the three-judge Bench held that the reasons to believe must refer to material, and the computation of tax must be supported by relevant and sufficient material. Arrest cannot be based on mere suspicion, or made to investigate whether the conditions are met. A final assessment is not always necessary, but there must be a degree of certainty that a non-bailable offence has been committed, and the benefit of doubt goes to the person. The Court also held anticipatory bail to be maintainable.
The Court relied on CBIC Instruction No. 02/2022-23 of 17 August 2022, which states that arrest should not be routine, should be approved only where intent to evade tax and mens rea are evident, and should not be used in technical disputes over interpretation. It also referred to Instruction No. 01/2025-GST of 13 January 2025, which requires grounds of arrest to be explained and furnished in writing as an annexure to the arrest memo.
Later rulings
On 12 August 2026, in Union of India v. Sunil Biyani, the Supreme Court (Justice Dipankar Datta and Justice Sheel Nagu) held that the Section 69 order must be communicated to the person before arrest, and indicated that it may be sent by email. The Commissioner’s reasons to believe are subject to judicial review.
In Jai Kumar Aggarwal v. DGGI, reported on 16 February 2026, the Allahabad High Court set aside a remand order because the grounds of arrest were not supplied as an annexure to the arrest memo, holding that the remanding Magistrate should have verified this. In Dharmendra Agarwal v. Union of India, reported on 22 January 2025, the Gauhati High Court held that the Commissioner must record why arrest is necessary, not only why an offence is believed to have been committed.
The proposal to remove arrest powers
On 8 October 2026, the 57th GST Council recommended omitting Section 69 and raising the prosecution threshold from Rs 1 crore to Rs 5 crore. These are recommendations; they need amendment of the CGST Act and the State GST Acts before they take effect.
Related questions
Can I apply for anticipatory bail in a GST case?
Yes. Radhika Agarwal held that anticipatory bail is maintainable against arrest under the GST law, even before an FIR, where there is a reasonable basis for apprehending arrest.
Must the Department show me its reasons to believe?
The Allahabad High Court held in February 2026 that the recorded reasons to believe need not be furnished, though the grounds of arrest must be. The Supreme Court in Sunil Biyani has since held that the arrest order must be communicated before arrest and that the reasons are subject to judicial review.
Can I be arrested before any tax demand is determined?
Possibly. Radhika Agarwal held that an assessment order is not always required, but there must be a degree of certainty, based on material, that a non-bailable offence has been committed.
Has GST arrest been abolished?
Not yet. The GST Council recommended it on 8 October 2026, but Section 69 remains in force until Parliament and the State legislatures amend the law.
Practical points
- Keep the email address registered on the GST portal current; orders may be served there.
- If an arrest order is communicated, ask for the grounds in writing and seek advice at once.
- Check that the arrest memo carries the written grounds as an annexure, with your acknowledgement.
- Prepare documents showing genuine supply and payment, which bear on the question of intent.
Sources: LiveLaw, Radhika Agarwal v. Union of India, 27 February 2025; LiveLaw Biz, Union of India v. Sunil Biyani, 12 August 2026; LiveLaw, Allahabad HC in Jai Kumar Aggarwal, 16 February 2026; PIB, 57th GST Council recommendations, 8 October 2026.
For a confidential discussion on GST investigations, see GST Investigation, Summons and Arrest.
General legal information only; not legal advice or solicitation.
