On 27.02.2025, a Three Justices' Bench of the Supreme Court delivered its verdict in a large batch of petitions which raised issues about the manner and exercise of the power of arrest without warrant under the Customs Act 1962 and the Central and State GST Acts. The judgment, reported as Radhika Agarwal v. Union of India & Ors. [2025 INSC 272 ('Radhika Agarwal')], consists of two opinions — one penned by the CJI for himself and Justice Sundresh, and a separate, mostly concurring, opinion by Justice Trivedi for herself.
This post will engage mainly with the majority opinion and its two main themes: (i) applying the Criminal Procedure Code 1973 [Cr.P.C.] to warrantless arrests made under the Customs Act and GST Acts, and (ii) regulating exercise of warrantless arrests under both these acts. There are some smaller issues / aspects, which I take up under a 'Miscellany' head. The post then turns to the separate opinion of Trivedi J. where I try and explain its synergy, and dissonance, with the majority opinion. A small concluding section ends the post.
Extending the Cr.P.C. to Warrantless Arrests under Revenue Laws
Radhika Agarwal unambiguously extends Cr.P.C. provisions regulating warrantless arrests by police to the exercise of such powers under the Customs Act / GST Acts by revenue officials. This means that officers conducting arrests must wear clear badges, must inform relatives about arrest, maintain diaries to note progress of investigation, furnish grounds of arrest in writing to an accused prior to them being taken before a magistrate for further custody, and allow the arrested person to meet with legal counsel during interrogation (though not for its entirety) [Paras 23-28].
One may reasonably argue that this extension is hardly a perceptible shift, as practically all of the above requirements were already being adopted by the relevant departments. The argument about extending the Cr.P.C. regime to arrests under the Customs Act / GST Acts regime was not to make sure that officers wear name tags while arresting persons — nobody goes to Court for that. The gain for petitioners and accused persons here was to firstly get clarity on whether Section 41-A Cr.P.C. applies to arrests under the Customs Act / GST Acts, and secondly get a ruling that officers conducting arrests under the special laws are police officers, which in turn would impact the evidentiary value of any statements recorded by them. On both these aspects, Radhika Agarwal rules in favour of the Union on my reading — slightly ambiguously in respect of the Section 41-A issue, and very resoundingly on the 'police officer' issue.
Section 41-A Cr.P.C. pertains to issuing notices to join an investigation. It has been used by the Supreme Court to foster a regime where today, for offences up to seven years, ordinarily such notices are sent to secure the cooperation of accused persons as opposed to rushing for an arrest. Extending it to the Customs Act / GST Acts regime would, in turn, help in staving arrests as most offences under these special laws are punishable up to seven years. Interestingly, the majority opinion in Radhika Agarwal is entirely silent on whether Section 41-A Cr.P.C. applies to the Customs Act / GST Acts regime on arrests. What to make of this? Technically, since Section 41-A is pre arrest and the judgment is concerned with post arrest issues, one may argue that the issue is left open. At the same time, nothing stopped the Court from looking at the clause, especially since the judgment refers to neighbouring Sections 41-B and 41-D of the Cr.P.C. It is fair to say that this issue may yet be litigated further.
Moving on, Radhika Agarwal decisively rejects the contention that officers arresting persons under the Customs Act / GST Acts regime are 'police officers'. It does not on the strength of its own reasoning, but by relying purely on precedent which recognised this distinction. This precedent has been extensively discussed elsewhere on this blog here, and in a paper here, with my view being that the distinction needs to be revisited. That the Court chose not to do so is a win for the government, since treating such officers as 'police officers' would have dealt a bodyblow to the evidentiary value of statements recorded by them during the course of an inquiry or investigation.
Nevertheless, reading Radhika Agarwal I wonder just how long this artificial distinction between officers will continue to hold the field, at least when a person is arrested. Since the 1960s, which is when the Constitution Bench decisions creating this artificial distinction came, the law has not remained static. A big change has been the shift in judicial perspective. The older cases took a formalist and hyper-technical approach to the issue to play a game of spot the difference where if even one facet from the Cr.P.C. regime on investigations was absent from the special law, that meant the officers under special laws were not seen as police officers for any purpose. Over time, this formalist approach gave way to a judicial perspective focusing on the impact of coercive action on life and liberty, especially when it comes to arrests. Radhika Agarwal also adopts this approach and uses it to further bridge the gap between arrests by ordinary police officers and revenue officers by extending the Cr.P.C. explicitly to the latter.
Warrantless arrests are a serious infringement with personal liberty. The gravity of this infringement does not alter on the basis of the department in question. Nor is there any difference in the consequential impact of arrests. If the evidentiary value of statements by arrested persons to regular police officers is deemed sketchy, nothing inherently changes the reliability of such statements by arrested persons when they are made to revenue officers. One hopes, therefore, that at least in the context of arrested persons, a bench of the Supreme Court will soon have the courage to simply apply the Duck Test, and treat all officers with the power of arrest without warrant as belonging to one category.
Regulating the Exercise of Arrest Powers
Unsurprisingly, the majority opinion in Radhika Agarwal extends the judicial approach recently taken by the CJI in Arvind Kejriwal [(2025) 2 SCC 248] which sought to regulate warrantless arrest powers under the Prevention of Money Laundering Act 2002 ['PMLA']. The PMLA arrest provision is quite similar to the Customs Act / GST Acts clause, allowing for easy transplantation. Essentially, this approach consists of two conjoint parts. First, an insistence upon rigid compliance with the statutory tests for warrantless arrests, and second, recognising that the exercise of this arrest power is amenable to judicial review.
The statutory test for warrantless arrest under the Customs Act / GST Acts has been reduced to a threefold exercise for ease of understanding: (i) the officer must have material in his possession, (ii) this material must be the basis to form 'reasons to believe' which are recorded in writing, that (iii) the person is guilty of having committed the alleged offence. Following Arvind Kejriwal, each of these three parts is developed by the Court in a way to ensure that the arresting power is not arbitrarily used. Thus, the 'material' must be translatable into legally admissible evidence and consist of all the material available and not deliberately exclude material that favours the accused. The 'reasons to believe' recorded in writing must be lucid and clear, and must be shared with persons. Lastly, the legislative mandate in requiring for reasons to believe a person is 'guilty' of the alleged offence suggests a higher threshold as compared to arrests governed by the Cr.P.C. provisions which prescribe a lighter test in the form of requiring only a reasonable suspicion (more on this later).
A little more time must be spent on the recording reasons part of the exercise here. The warrantless arrest power under the Customs Act / GST Acts regime is not recognised for all crimes. Instead, it triggers only if a certain monetary threshold is crossed (in most cases). For instance, only if the alleged tax intentionally evaded by the accused is beyond 5 Crores does the warrantless arrest power come alive under the GST Act. What Radhika Agarwal clarifies is that the recording of reasons must also explain on what basis has an officer decided that the monetary threshold was crossed. While this is undoubtedly a significant move, the Supreme Court does not go quite as far as the Delhi High Court had back in 2016, when in context of service tax laws it had restricted the warrantless arrest power as contingent upon a tax assessment order being passed quantifying the tax demand as crossing the monetary limit.
Significant also is the fact that the majority opinion deals with a contention that the threat of arrest was being used to coerce persons into paying tax dues. Obviously, the Court holds that arrest powers cannot be used to coerce persons into paying up, but it takes the issue a step further to hold that aggrieved persons can take their pleas to court and, if found true, then they would be entitled to refund of any dues so coercively paid. Whether this remedy is a meaningful one or not is difficult to say, considering judicial delays and the difficulty to establish coercion.
Which brings us to the second part of the regulatory exercise — judicial review of arrests. The existence of having statutory tests regulating the exercise of arrests is meaningless without the possibility of judicial review, and one reason for the Court to insist upon strict and documented compliance with statutory tests for arrest is to ensure fairer exercise of judicial review. At the same time, the majority opinion itself notes, in line with Arvind Kejriwal, that the review here is not a 'merits' review by, for instance, testing whether the material itself was correct or not. Rather, it is akin to judicial review of administrative action, allowing courts to step in if the action is, for instance, found to be entirely unreasonable, perverse, arbitrary, or is an action based on jurisdictional error. The import of proportionality analysis will aid this exercise. Though it must be flagged that a key issue within a proportionality assessment of whether the necessity of an arrest can be reviewed was referred to a larger bench in Arvind Kejriwal and remains pending.
I will return to the theme of judicial review when dealing with the separate opinion. Before that, a slight detour to cover some miscellaneous findings of interest.
Miscellaneous Findings
There are some other notable points in the majority opinion, out of which I would want to flag two given their connection with the blog. First, the opinion has again remained faithful to precedent where it notes that persons who have received a notice to cooperate with the inquiry etc. under the revenue laws are not persons 'accused of an offence' for purposes of Article 20(3) of the Constitution. Second, the opinion notes that even though such persons may not be falling within the scope of Article 20(3), they can still avail of their remedies to seek anticipatory bail, where they can demonstrate that a threat of arrest exists. In doing so, the Court overrules the contrary view taken by some benches last year, which was also criticised on the blog here.
The Separate Opinion
Justice Trivedi's short separate opinion is restricted only to expressing her views on the manner in which judicial review of the exercise of arrest powers ought to be conducted. Is it a concurrence, or a dissent, or yet another one of those separate opinions which is a bit of both? While on first blush it appeared that the third category is the safest bet, on a re-reading of her opinion I do believe that it is a concurrence which is merely emphasising the note of caution which is inherent in the majority opinion itself. At the same time, I also sense a divergence of views on a more fundamental aspect of what is the purpose of arrests in context of revenue laws.
Justice Trivedi recognises the power of writ review in context of warrantless arrests, but urges that courts should ordinarily be 'loath' to interfere with use of the power by the concerned authorities under laws that concern serious financial crimes. Thus, while she agrees that non-compliance with the statute would be a valid ground for review, she cautions that this should not prompt courts to use a 'magnifying glass' to blow up minor procedural lapses on part of officers and confer undue benefits upon accused persons.
This, according to me, is just a more cautious way of expressing the same idea as the majority: do not go for a merits review, and do not interfere unless the decision is found perverse or arbitrary. Minor technical violations would not pass muster even under the Arvind Kejriwal standard, which Justice Trivedi does not disagree from specifically within her opinion.
I would submit that a large part of Justice Trivedi's concerns, and the seeming differences in her view from the majority, stem from deeper differences in how the two opinions viewed the use of the arrest power. For the separate opinion there is a tight nexus between arrest and investigation, requiring a wider berth to be granted to agencies. Thus, one finds that Justice Trivedi urges caution while reviewing arrests because the investigation may be at a 'very nascent' stage. Whereas for the majority opinion, a legislative mandate that allows warrantless arrest only upon gathering material sufficient to form reasons to believe that a person is guilty of the offence assumes that an investigation has progressed to a degree. In fact, the majority opinion at one place in its discussion on the GST regime specifically notes that the arrest "cannot be made to merely investigate whether the conditions are being met." Thus, the arrest power in these revenue laws is not primarily used as an investigate tool, but a step later on in the inquiry and adjudicatory process.
In this regard, while I understand the perspective of Justice Trivedi, it is understandable why the majority opinion does not begin from that standpoint. In rare cases, arrests in revenue laws may occur at a nascent stage and there the usual caveats may apply, but that is not the norm. After all, it is because arrests are not routine parts of investigations under revenue laws that courts have sustained the distinction between the traditional crime versus the revenue offence, and used this distinction to conclude that the revenue officers are not 'police officers'. The legislative mandate must be respected in full, and the majority opinion rightly does so.
Conclusion: Confronting Two-Track Justice
The majority opinion in Radhika Agarwal re-emphasises that the power of warrantless arrests is drastic. It places this perspective at the heart of its reasoning to adopt conclusions which, in the eyes of the Court, aim to assist in the better regulation of how this drastic power is exercised. In pushing for better regulation the Court implicitly admits that the current scenario was suboptimal.
If the current scenario is indeed suboptimal, that calls for some pause to think and reflect. Throughout Radhika Agarwal we are reminded that the scheme for warrantless arrests under the Customs Act / GST Acts is different from the scheme governing such arrests for ordinary crimes made under the Criminal Procedure Code (now Bharatiya Nagarik Suraksha Sanhita 2023). The threshold under the special laws for exercising this power is higher than the threshold under regular criminal law, and what Radhika Agarwal does is to tighten the bolts even further to ensure better regulation. At the same time, the total number of persons arrested under the special laws (and we can even add the PMLA here) is incomparably lesser than persons arrested everyday under the Cr.P.C. / BNSS for ordinary crime. Not only this, but the demographic of persons ordinarily being arrested under both sets of laws is also incomparable. Those arrested under the special laws are, usually, the 'haves' with access to money and resources, whereas the ordinary criminal accused are the 'have-nots' who are struggling to make ends meet.
There is, in practically every legal system, a two-track system of justice: one for the 'haves', and another for the 'have-nots'. The law cannot completely rid the handicap that the have-nots suffer from because of their lack of resources and access to capital, but what a fair legal system can try and do is to make sure that it is designed to reduce the impact of this inequality. For instance, in context of warrantless arrests, a fair legal system would prescribe the same threshold for arrests under crimes traditionally linked only with the 'haves' — such as tax fraud — and the usual crimes which traditionally mostly ensnare the 'have nots' to ensure that the law is not compounding the ill-effects of the latent inequality. Instead, what we have, is the exact opposite in place. A two-track system of justice with an arrest regime having strong safeguards under laws that primarily concern the haves (made even more robust by court) and an arrest regime with weak safeguards when it comes to the 'have nots' ensuring their liberty remains imperilled.
This is a manifest injustice at the heart of this entire regime governing warrantless arrests. Rather than the ordinary law being dragged down to further improve upon the safeguards for warrantless arrests in special laws, one hopes that future benches of the Supreme Court and High Courts use the good work done by judgments such as Radhika Agarwal to raise the standard even for arrests under ordinary crimes. A start has, arguably, already been made in recent judgments on supplying the grounds of arrest. While the first judgments were indeed under a special law — the PMLA — the subsequent judgments affirmed this rule as applicable to all arrests. One hopes that a similar effect is felt in context of the arresting power itself, to tighten the bolts around the 'reasonable suspicion' standard under the Cr.P.C. / BNSS as well. Such an outcome would ensure that the drastic power of warrantless arrests is better regulated in its application to lakhs of Indians, as opposed to the few hundreds who are alleged to be evading taxes.
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