In a significant action involving alleged tax evasion under the National Security CESS framework, a court in Meerut has remanded two accused persons – Sanchit Seth and Mohsin Khan to judicial custody after authorities claimed detection of large-scale GST-related irregularities involving the manufacture and packaging of pan masala products. The proceedings arise out of a case registered under Sections 18(1)(a), 18(1)(b), 18(1)(f), and 19(1)(a) of the Health Security National Security CESS Act.
According to the case materials placed before the Civil Judge (Junior Division)/Judicial Magistrate, Meerut, the CGST Commissionerate, Ghaziabad alleged that an estimated tax evasion of approximately ₹14.56 crore had been identified during investigation. The prosecution stated that the accused, Sanchit Seth and Mohsin Khan, were involved in activities connected with manufacturing pan masala pouches through the use of raw materials and packaging machinery.
SSP Lakshay Kumar Singh on behalf of the department informed the court that acting upon specific information, departmental authorities carried out a search operation on 22 May 2026 at premises situated in Viladan Garden, Sahibabad, Ghaziabad. During the search operation, officials allegedly recovered a substantial quantity of pan masala packing material, approximately seven bags containing raw materials, a packaging machine and sealing equipment, along with other material allegedly connected with manufacturing activities. The department prepared a seizure memorandum and undertook inventory and panchnama proceedings at the site. The search exercise allegedly indicated the existence of an operational setup for preparation and packaging of pan masala products.
The department further submitted before the court that summons had been issued to the accused for appearance on 23 May 2026. Their statements were reportedly recorded and relevant documents were collected during the course of the investigation. Authorities also claimed that the accused had admitted involvement in activities relating to the processing and preparation of pan masala products. According to the prosecution version, documentary material and reports generated by the Commissioner formed part of the evidence collected during the inquiry.
Counsel appearing for the accused opposed the prosecution’s submissions and argued that the accused had been falsely implicated in the matter. It was contended that they were respectable citizens and that their arrest was unlawful. The defence maintained that the statements attributed to the accused were not reliable and asserted that no material existed linking them with any criminal activity. The accused also argued that no independent evidence had been produced to establish the alleged offences and sought their release.
After examining the materials placed before it, the court observed that allegations involving tax evasion amounting to approximately ₹14.56 crore had been levelled against the accused. The court noted that one accused had been arrested near the CGST office in Ghaziabad and produced before the court within the stipulated period. It further recorded that the investigation remained ongoing and that fresh facts could emerge during the course of the inquiry. The court also observed that the alleged conduct pertained to a serious economic offence and, at that stage, the material placed by the department could not be ignored.
Consequently, the court directed that the accused be remanded to judicial custody and sent to District Jail, Meerut. The matter has been listed for further proceedings and consideration of bail on 5 June 2026.
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