A S BANKA ADVISORS

If you are a director, promoter or CFO of a GST registered entity, here is the most useful thing you can do this week: open the GST portal and check the email address and mobile number on the registration of every entity you are an officer of. If that inbox routes to a former employee, a lapsed consultant, or an address nobody opens, fix it today.

That sounds like housekeeping. After the Supreme Court’s judgment of 12 August 2026 in Union of India v. Sunil Biyani, 2026 INSC 849, it is not. That field is now a channel through which an order authorising your arrest can validly reach you.

What the Court Decided

The Department won the appeal and lost the point that governs how a GST arrest works in practice. Most coverage reported the first half and stopped.

Holding one (paragraph 11). A High Court or Sessions Court that dismisses a pre-arrest bail application as not maintainable cannot attach protection from arrest to that dismissal. Interim relief exists only “in aid of and as ancillary to the main relief”, a principle running back to the five judge Bench in State of Orissa v. Madan Gopal Rungta, 1951 SCC 1024, and applied to criminal matters in Hema Mishra v. State of U.P., (2014) 4 SCC 453. When the application falls, the protection falls with it.

Holding two (paragraphs 18 and 22). The order under Section 69 of the CGST Act, 2017 must be communicated to the person sought to be arrested, before the arrest. The Court read that requirement into a statute whose text does not contain it, on principles of natural justice and fairness in administrative action. Its closing words leave no ambiguity: “We reiterate, without such communication, question of arrest would not arise.”

What You Lose, and What You Gain

For a founder under investigation this is a straight trade. You lose the protective cushion: filing for anticipatory bail the moment a summons lands and collecting a protective direction is now closed, because a summons under Section 70 does not make you an accused (Radhika Agarwal v. Union of India, (2025) 6 SCC 545), so the application is premature and nothing can be attached to soften its dismissal. What you gain is a rule against being picked up in the dark. Paragraph 20 puts it plainly: without disclosure of the “reasons to believe” you cannot test them, and “withholding of reasons could have drastic consequences on the right to liberty of the accused.”

Why the Email Field Matters

Paragraph 21 supplies the mechanics, and this is the under-reported part. Rule 8 of the CGST Rules, 2017 requires every applicant for registration to declare a mobile number and an email address in Part A of FORM GST REG-01, each verified by a separate one time password. The Department therefore already holds a working electronic address for every registrant. On that basis, the order “may be communicated through electronic means in addition to the mode, as permitted under the BNSS, as well as all other permissible modes of communication.”

Electronic service is expressly permitted, not merely tolerated. Nobody has to hand you a paper order at your office. Your new right to be told before arrest is only as good as the inbox you gave the Department, possibly years ago, when someone else handled registrations.

When a GST Arrest Is Possible at All

Section 69 is not a general power. It reaches only clauses (a) to (d) of Section 132(1): supply without invoice to evade tax; invoice without supply leading to wrongful input tax credit or refund; availing that credit, or fraudulently availing credit without any invoice; and collecting tax but not paying it over for more than three months.

• Above Rs 5 crore (Section 132(1)(i)): imprisonment up to five years. Under Section 132(5) these offences are cognizable and non bailable.
• Rs 2 crore to Rs 5 crore (Section 132(1)(ii)): imprisonment up to three years. Arrest is possible, but the offence stays non cognizable and bailable under Section 132(4).
• Grounds of arrest (Section 69(2)): for a Section 132(5) offence the officer must inform you of the grounds and produce you before a Magistrate within twenty four hours.
• Sanction (Section 132(6)): no prosecution without the previous sanction of the Commissioner.

That Rs 2 crore to Rs 5 crore band gets blurred constantly. Arrest is available there, but the offence is bailable. Pin the number down early: it changes the entire posture of the engagement.

Three Things the Coverage Left Out

Section 438 CrPC is now Section 482 BNSS. At paragraph 19 the Court expressly maps the anticipatory bail provision to Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023. A draft still citing Section 438 CrPC as live procedure is stale.

The reasoning is constitutional, not procedural. The Court leaned on the five judge Bench in Gurbaksh Singh Sibbia v. State of Punjab, (1980) 2 SCC 565, and on Maneka Gandhi, warning against “an over-generous infusion of constraints and conditions” and anchoring the analysis in Article 21. That gives the holding weight well beyond this fact pattern.

It plugs into the anticipatory bail framework. Paragraph 18 ties the communication requirement to Sushila Aggarwal v. State (NCT of Delhi), (2020) 5 SCC 1. This is not a narrow indirect tax point.

The Advisory Point: Separate the Entity From the Officer

The structural lesson has little to do with GST procedure. A demand on the company and a Section 69 order against an individual are different instruments with different consequences, and most groups we review have never mapped the second. Who is an officer on record for each GSTIN? Which of them exited without a clean DIR-11, DIR-12, board resolution and email acknowledgement in one place? Whose registered email belongs to someone who left three years ago?

Those questions are cheap to answer before an investigation and expensive during one. Here, three summonses met with adjournment requests turned a document request into two years of litigation ending in the Supreme Court.

What To Do Now

1. Verify the email and mobile on every GSTIN where you are an officer. Correct anything dormant.
2. Attend the Section 70 summons. Non attendance converts a document request into an adverse inference.
3. Do not rush to court at the summons stage. The application will be dismissed as premature.
4. Ask the Department in writing whether an order under Section 69 has been passed. Its answer defines the stage of the proceedings, exactly as its affidavit did here.
5. When an order is communicated two clocks start: your right to seek pre-arrest bail, and your right to challenge the “reasons to believe” by judicial review. Brief counsel before that day.
6. Keep the exit trail for anyone who has resigned in one folder, not scattered across three inboxes.

Download the full carousel PDF covering the two holdings, the threshold map and the action checklist in nine slides.

Source and Verification

Judgment: Union of India v. Sunil Biyani, 2026 INSC 849, Criminal Appeal arising out of SLP (Crl.) No. 12535 of 2026, Dipankar Datta and Sheel Nagu JJ., authored by Dipankar Datta J., New Delhi, 12 August 2026. Also reported as 2026 SCC OnLine SC 1544 and 2026 LiveLaw (SC) 797. All quotations are from the full text. Several secondary reports date it 13 August 2026; the judgment itself is dated 12 August 2026.

Statute: Sections 69 and 132 of the CGST Act, 2017 were read on 18 August 2026 from the CBIC tax information repository at taxinformation.cbic.gov.in, which carries the Board’s current text with amendment footnotes; Rule 8 of the CGST Rules, 2017 from cbic-gst.gov.in. Clauses (g), (j) and (k) of Section 132(1) stand omitted from 1 October 2023 by the Finance Act 2023, and clause (iii) is now confined to clause (b) offences. The Rs 5 crore and Rs 2 crore thresholds in clauses (i) and (ii) are unchanged.

Held back deliberately: the judgment records no figure for the alleged evasion and no designation for Mr Biyani. Press reports carry both. We assert neither.

Talk to Us

If a group entity you are an officer of has received a summons under Section 70, or you are not certain the email on your GST registrations would actually reach you, that conversation is better had before an order exists than after. Book a quick call and we will map your officer level exposure across your entities.

CA Adityavikram Banka, Founder, A S Banka Advisors Private Limited.