Traders in Gujarat Allege Misuse of GST Inspection Powers by Officials

Last updated: 05 August 2025


Quick Summary
Traders in Gujarat are raising serious concerns about alleged misuse of GST inspection powers by officials. They claim that under the guise of routine inspections, officials are overstepping their authority, resembling raids and seizures, and engaging in intimidation and extortion. Complaints highlight vague warrants and aggressive tactics that cause distress, particularly to smaller businesses, leading to demands for greater transparency and protection.

Traders across Gujarat have levelled serious allegations against officials from both the Central and State GST departments, accusing them of misusing Section 67(1) of the GST Act to harass, intimidate, and extort money under the guise of inspections and surprise visits. According to multiple compla
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FAQ :

Traders in Gujarat are accusing GST officials of misusing Section 67(1) of the GST Act to harass, intimidate, and extort money under the guise of inspections and surprise visits.

Officials are reportedly entering business premises without clearly stating the legal basis, conducting actions that resemble full-scale raids and seizures (Section 67(2)) rather than simple inspections, and using vague warrants.

Traders report that officials allegedly confiscate mobile phones, access accounting records, and issue informal demands for large payments, actions they claim border on extortion.

The Federation suggests mandatory specification of legal provisions in warrants, allowing tax consultants to accompany traders during inspections, educational initiatives on inspection vs. seizure, and encouraging supportive officer behaviour.

Traders warn that the alleged misuse of legal provisions is damaging trust in the GST system and could deter voluntary compliance if not urgently addressed.




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Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

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