2018 (5) TMI 367 - HC - GST

Seizure of goods - penalty u/s 129(1) and 129(3) of GST Act - GST e-way bill-01 - petitioner claim is that the distance was much below within the prescribed limit of 50 km in between the consignors place of business and transport company from where the goods were required to be reloaded in different transport vehicles for their onward journey and so they are not required to furnish the details of conveyance in Part B of GST e-way bill-01. Held that - since the consignor and consignee both are registered dealers as well as the present petitioner who is a transport company, there is no basis or reason not to accept the contention of the learned counsel for the petitioner and further once the Government itself has clarified the situation by allowing the transporter/dealer to fill up Part B of the e-way bill when the goods are reloaded in a vehicle which is meant for delivery to the consignee, there remain no reasons to seized the goods and the vehicle. Seizure order and penalty set aside - petition allowed.

Summary

Issues:
Challenge to seizure order and penalty notice under Section 129(1) and 129(3) of the Act respectively.

Analysis:
The petitioner, a registered company under the GST Act, challenged a seizure order and penalty notice issued under Section 129(1) and 129(3) of the Act respectively. The petitioner company, engaged in transportation of goods, had a branch leased out for loading and unloading goods. The consignor dispatched Flexible Laminates to two registered dealers, one in Telangana and the other in Uttarakhand, for which the petitioner downloaded two national e-way bills. However, the Assistant Commissioner intercepted the goods, citing the blank 'Part B' of the e-way bill, leading to the seizure order and penalty notice.

The petitioner argued that the distance between the consignor's place and the transporter's branch was within the 50 km limit exempted from filling 'Part B' of the e-way bill. The petitioner also highlighted notifications amending e-way bill rules and a Press Information Bureau clarification on e-way bill procedures. The petitioner contended that the seizure and penalty were illegal, given the exemption and the government's own clarifications.

The Court examined the e-way bill system clarification, emphasizing that 'Part B' of the e-way bill could be filled by the transporter only after the goods reached the transporter's location for reloading. The Court found no reason to disbelieve the petitioner's explanation provided during the inspection. Considering that all parties were registered dealers and the government's clarification allowed filling 'Part B' upon reloading, the Court set aside the seizure order and penalty notice, ordering the release of goods and the vehicle upon furnishing an Indemnity Bond for the proposed tax and penalty.

In conclusion, the Court allowed the writ petition, emphasizing the legality of the petitioner's actions under the e-way bill system and the lack of justification for the seizure and penalty imposed by the authorities.