Just because they thought so doesn't really give them the ground to take things away like that. I am sure in the US you might even would be able to sue them for it.
And as far as mining goes, there is no reason for it to be illegal(as long as bitcoin isn't). As the electricity you are using is what you are paying for. And its not illegal to use more of it for mining.
Yes absolutely, a spike in electricity usage is perfectly acceptable grounds for them to get a search warrant on suspicion of growing hash using high watt lamps, they are more than welcome to come in every week to check I'm not growing hash, what I have a major problem with is them coming in, not finding anything illegal but taking everything I own anyway!! I can't run my business without my computers, I'm taking the state to the high court, very expensive but I'm confident I'll win because ive done nothing wrong...