A) ABSTRACT / HEADNOTE

Radhika Agarwal v. Union of India and Others, [2025] 2 S.C.R. 1331 : 2025 INSC 272 Writ challenge to the constitutional validity of arrest powers conferred on authorised officers under the Customs Act, 1962 (particularly ss.104(1), 104(4), 104(6)) and the Central Goods and Services Tax Act, 2017 (notably ss.69, 70, 132). The petitioners relied on Om Prakash v. Union of India to contend that customs offences remained non-cognizable and that arrests without Magistrate-warrant violated the Code of Criminal Procedure and Articles 21 and 22.

The Court (majority per Sanjiv Khanna, CJI) rejected the challenge, holding that post-Om Prakash legislative amendments (Finance Acts 2012, 2013, 2019) expressly made certain offences cognizable and some non-bailable; these statutory changes, read with Chapter XII of the CrPC, create a distinct arrest regime under the Customs and GST Acts and satisfy constitutional requirements.

The Court emphasised that arrest under these special Acts must meet stringent pre-conditions: the authorised officer must have adequate material, form and record in writing reasons to believe tied to statutory thresholds (including monetary computations), inform the arrestee of grounds in writing, and maintain proper records to permit effective judicial review.

The Court also held customs officers are not police officers for evidentiary purposes and reiterated that the CrPC applies except where expressly excluded. The GST provisions empowering arrest were held intra vires Article 246-A, being ancillary to GST levy and collection. The concurring opinion (Bela M. Trivedi, J.) urged judicial restraint in review of arrests under special Acts but insisted on compliance with statutory safeguards.

Keywords: Section 104(4), 104(6) Customs Act; Section 132 GST Act; “reasons to believe”; “material”; cognizable/non-cognizable; non-bailable; Article 246-A; judicial review; Code of Criminal Procedure.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The controversy originates from the three-Judge Om Prakash decision (2011) that treated offences under the Customs Act and Excise Act as non-cognizable, limiting authorised officers’ power to arrest absent a Magistrate’s warrant. Following Om Prakash, Parliament enacted targeted amendments (Finance Acts, 2012, 2013, 2019) carving out specified categories as cognizable (s.104(4)) and some as non-bailable (s.104(6)).

Challenge to these post-Om Prakash enactments crystallised around two questions:

(i) whether Parliament could validly confer arrest powers for GST-related offences under Article 246-A and whether such powers are ancillary to GST levy/collection;

(ii) whether the statutory wording and procedural safeguards (material, reasons to believe, informing arrestee, record-keeping) are adequate to satisfy Article 21/22 and avoid arbitrary detention.

The Supreme Court accepted these constitutional and statutory questions, undertook a detailed textual and purposive interpretation of s.104 and s.132 (GST), and tested the statutory framework against precedents including Arvind Kejriwal (PMLA arrest jurisprudence) and principles of proportionality and procedural fairness. The Court’s analysis balanced the State’s legitimate interest in coercive tools to check sophisticated fiscal offences against individual liberty, prescribing exacting standards for officers before invoking arrest.

D) FACTS OF THE CASE

Multiple writs and connected SLPs challenged arrests, threats of arrest and departmental practices under Customs/GST investigation wings. Petitioners asserted that:

(a) Om Prakash mandated Magistrate approval before arrests for customs offences;

(b) post-amendment statutory provisions unlawfully expanded arrest power;

(c) departmental practice compelled deposit of tax during raids by threatening arrest; and

(d) s.132(1) arrests under GST could not be valid unless assessment under s.73/74 quantified liability.

The State defended by pointing to legislative amendments creating cognizable/non-bailable categories and argued that pre-conditions (material, recorded reasons to believe) suffice as safeguards. The record included departmental circulars (CBIC Instruction 2022; Instruction No. 01/2025) and data showing correlations between payments and arrest frequency. Several petitioners relied on facts of coercion during investigations alleging that arrests or threat thereof were used to extract tax payments without due process. The litigation therefore required judicial clarification of statutory thresholds, safeguards, and limits on departmental coercive conduct.

E) LEGAL ISSUES RAISED

i. Whether the post-Om Prakash amendments to the Customs Act validly empower authorised officers to arrest without Magistrate warrant?
ii. Whether s.104(1)’s “reasons to believe” threshold and s.104(4)/(6) monetary criteria afford constitutionally adequate safeguards against arbitrary arrest?
iii. Whether ss.69/70/132 of the CGST Act, 2017 are ultra vires Article 246-A and beyond Parliament’s legislative competence?
iv. Whether departmental practice of coercing payment by threat of arrest violates Article 21/22?

F) PETITIONER / APPELLANT’S ARGUMENTS

i. The petitioners contended that Om Prakash remains binding and mandates Magistrate warrant for arrests in customs matters; post-Om Prakash amendments do not cure constitutional defects.
ii. They argued s.104(1) lacks express requirement of material in possession and therefore permits arrests on mere suspicion; monetary thresholds cannot be established without assessment orders.
iii. Petitioners alleged administrative coercion: circulars and on-the-spot payment practices amounted to compulsion and denied procedural safeguards.

G) RESPONDENT’S ARGUMENTS

i. Respondents maintained that Finance Act amendments expressly made specified offences cognizable and some non-bailable, thereby altering the legal landscape and validating arrest powers.
ii. They contended authorised officers must follow internal safeguards — record reasons, rely on material — and that arrests serve legitimate public interest in combating complex fiscal evasion.
iii. On GST vires, respondents submitted that powers to summon, arrest and prosecute are ancillary to Article 246-A’s core power to levy and collect GST.

H) JUDGEMENT

The Court upheld the constitutional validity of the amended Customs Act and of the GST provisions authorising arrest. Key holdings:

• Legislative change and Om Prakash: The Court held Parliament deliberately amended s.104 (2012, 2013, 2019) to carve out specific cognizable and non-bailable offences, thereby altering Om Prakash’s practical effect; reliance on Om Prakash was therefore misplaced post-amendment.

• Standards for arrest  material & reasons to believe: Adopting the logic of Arvind Kejriwal (PMLA jurisprudence), the Court required authorised officers to have tangible material, form an opinion and record reasons to believe in writing showing:

(i) commission of specified offence(s),

(ii) satisfaction that the offence is non-bailable where relevant, and

(iii) monetary thresholds met by objective computation.

Arrests based on mere suspicion or to investigate whether conditions apply are impermissible. The reasons to believe must be disclosed to the arrestee (with limited redaction in exceptional cases).

• Application of CrPC: The CrPC applies save where a special Act contains contrary provision; thus Chapter XII principles and provisions relevant to arrest/detention inform judicial review and procedural protections.

• Customs officers ≠ police officers: Reaffirming precedent, customs officers are not police officers under s.25 Evidence Act unless statutorily vested with full police powers including s.173 CrPC reporting.

• GST vires & Article 246-A: GST Acts are within Parliament’s legislative competence; powers to arrest/summon are ancillary to levy/collection; challenge to ss.69/70 rejected.

• Compulsion to pay during probes: On evidence of threatened arrests to extract tax payments, the Court condemned coercion and directed CBIC to issue guidelines preventing use of arrest threat to compel payment; abused instances entitle affected persons to seek refunds and departmental action.

a. RATIO DECIDENDI

The decisive legal principle is that statutory arrest powers in special fiscal enactments are constitutionally permissible if:

(i) the legislature plainly classifies offences cognizable/non-cognizable and bailable/non-bailable;

(ii) authorised officers exercise arrest only after possession of sufficient material and after recording contemporaneous reasons to believe explaining how statutory thresholds (including monetary limits) are met;

(iii) procedural safeguards (informing grounds in writing, diary/record maintenance) are observed to enable effective judicial review.

The Court thus harmonised s.104(1) with s.19(1) PMLA jurisprudence and stressed higher threshold than s.41 CrPC.

b. OBITER DICTA

The Court emphasised proportionality doctrine in arrest contexts and cautioned against routine judicial interference in special Acts unless manifest arbitrariness or gross non-compliance of safeguards is shown. The concurring opinion stressed prudential restraint in judicial review but insisted on strict compliance with statutory safeguards and protection of Article 21/22 rights. The Court also noted limited scenarios where reasons to believe may be redacted, and underscored that anticipatory bail principles remain applicable.

c. GUIDELINES 

1. Material requirement: Officers must have tangible material before arrest.
2. Reasons to believe: Written, explicit, refer to underlying material and monetary computation; must state satisfaction about bailability status.
3. Informing arrestee: Grounds to be given in writing before production to Magistrate.
4. Records & diary: Maintain comprehensive file/diary entries like case diary to permit Magistrate review.
5. No coercion for recovery: CBIC to frame instructions to prevent threats/compulsion to pay in lieu of due process.

I) CONCLUSION & COMMENTS

This judgment realigns arrest jurisprudence under fiscal statutes by blending legislative will (post-Om Prakash amendments) with protections enunciated in Arvind Kejriwal and allied authorities. Practically, it preserves governmental capacity to address sophisticated customs/GST frauds, while mandating rigorous documentary foundations and transparent reasons to avoid arbitrary liberty deprivation.

The Court strikes a textured balance: endorsing special Acts’ coercive tools but insisting on high procedural fidelity a template likely to shape departmental practice, Magistrate scrutiny, and lower courts’ approach to bail/anticipatory bail in fiscal investigations. Departments must now ensure disciplined adherence to material and reasons to believe requirements; failure will render arrests vulnerable to being quashed. Judicial restraint is counselled, but not at the cost of tolerating procedural shortcuts or administrative coercion.

J) REFERENCES

a. Important Cases Referred

1. Radhika Agarwal v. Union of India & Ors., [2025] 2 S.C.R. 1331 : 2025 INSC 272.

2. Om Prakash & Anr. v. Union of India & Anr., (2011) 14 SCC 1.

3. Arvind Kejriwal v. Directorate of Enforcement, (2025) 2 SCC 248 / (2024) 6 SCR 346.

4. Directorate of Enforcement v. Deepak Mahajan & Anr., (1994) 3 SCC 440.

5. R.S. Joshi v. Ajit Mills Ltd., (1977) 4 SCC 98.

6. D.K. Basu v. State of West Bengal, (1997) 1 SCC 416.
   (Other cases listed in the judgment have been relied on and appear within the attached judgment. See the judgment for the full list.)

b. Important Statutes Referred

1. Customs Act, 1962 — ss.104(1), 104(4), 104(5), 104(6), 104(7).
2. Central Goods and Services Tax Act, 2017 — ss.67, 69, 73, 74, 132.
3. Code of Criminal Procedure, 1973 — ss.4,5,41,50,155,167,173.
4. Prevention of Money Laundering Act, 2002 — s.19(1) (comparative jurisprudence).