2017 (9) TMI 1044 - HC - GST

Detention of goods - it was alleged that there were no nexus between the documents accompanied and the actual goods under transport - Section 129(3) of the Central/State Goods and Services Tax Act, 2017 - Held that - the statutory provisions provide a mechanism for adjudication following detention of goods including for the provisional release thereof pending adjudication. When the statute itself provides for such a mechanism, a deviation therefrom cannot be ordered. If that be so, the provisional release in the manner as is ordered in the judgment under appeal cannot be sustained. The provisions of Rule 140 (2) obliging a dealer to produce the goods as and when demanded, and considering the inconvenience and prejudice that is likely to be caused on account of the delay, we need hardly emphasise the necessity for an expeditious adjudication even in cases goods are released provisionally - the respondent directed to produce a copy of this judgment before the second appellant, who thereupon, will issue necessary notice and conduct physical verification in the presence of the respondent and complete adjudication, at any rate, within one week - petitioner is also given liberty to comply with Rule 140(1) and get provisional release on that basis.

Summary

Issues: Detention of goods under Section 129 of the CGST Act and SGST Ordinance, Provisional release of goods pending adjudication, Compliance with statutory provisions for release of goods, Expedited adjudication process.

In this judgment by the Kerala High Court, the respondent, a registered dealer under the KVAT Act migrated to the CGST Act, had goods detained during transportation due to irregularities in the documents accompanying the consignment. The detention was under Section 129(3) of the Central/State Goods and Services Tax Act, 2017. The writ petition challenged the detention and sought release of the goods upon payment of a specified amount. The court noted that Section 129 of the CGST Act and SGST Ordinance provides for detention, seizure, and release of goods in transit. It was highlighted that the statute outlines a specific mechanism for the release of goods pending adjudication, including the provision for provisional release upon execution of a bond and furnishing of security. The court emphasized that a deviation from the statutory provisions for provisional release cannot be ordered. However, considering the inconvenience caused by delay and the necessity for expeditious adjudication even in cases of provisional release, the court directed the respondent to produce a copy of the judgment before the relevant authority for necessary action and completion of adjudication within one week. The judgment set aside the previous order and provided the petitioner with the liberty to comply with Rule 140(1) for provisional release based on the specified conditions.

The court's decision focused on upholding the statutory provisions governing the detention and release of goods under the CGST Act and SGST Ordinance. It emphasized the need for adherence to the prescribed mechanisms for provisional release and highlighted the importance of expeditious adjudication even in cases of provisional release to prevent undue delay and inconvenience to the parties involved. The judgment aimed to ensure compliance with the legal framework while balancing the interests of the parties by directing prompt adjudication of the matter within a specified timeline.