2019 (8) TMI 776 - HC - GST

Validity of detention of goods - failure to generate or produce E-Way Bill - Section 129 (1) of CGST Act, 2017 - HELD THAT - This Court is not convinced to entertain the writ petition and adjudicate upon merits at this stage. To conform to the scheme under the Act, the writ petition is disposed of by this order. As the petitioner submitted that he has already deposited ₹ 12, 555/- towards tax incidence and the other component namely penalty is permitted be deposited in cash of ₹ 12, 555/- and upon producing proof of deposit, the goods are released forthwith. The deposit of amount by petitioner is without prejudice to the rights and contentions he has in this behalf. Petition disposed off.

Summary

Issues:
Challenge to detention order and notice under CGST Act, 2017.

Analysis:
The petitioner challenged the legality and jurisdiction of Exts. P6 and P7 notices issued by the 1st respondent under the CGST Act, 2017. Ext. P6 was an order of detention, while Ext. P7 was a notice. The petitioner argued that all requirements of the Act were met, and the inability to produce the E-Way Bill for inspection within the given time did not warrant the proceedings initiated through Exts. P6 and P7.

The Government Pleader objected to the writ petition's maintainability, stating that there was an omission or illegality in the transportation of goods. The transporter failed to produce all necessary documents during inspection to establish valid transit. The Government Pleader highlighted that Section 129 of the Act deals with detention and release of goods, subject to the petitioner complying with its provisions. The petitioner could secure the release of goods by furnishing a bank guarantee for the tax and penalty amount demanded through Ext. P7.

In response, the petitioner's counsel argued that the detention of goods was unwarranted as the transit was in compliance with the law. The petitioner had already paid Rs. 12,555 towards tax incidence and was willing to deposit the penalty amount in cash.

The Court, after considering the arguments, disposed of the writ petition. The Court was not convinced to entertain the petition at that stage and emphasized adhering to the Act's scheme. The petitioner was allowed to deposit the penalty amount in cash, and upon proof of deposit, the goods were to be released immediately. The deposit was made without prejudice to the petitioner's rights and contentions, which could be raised at an appropriate stage in a properly initiated proceeding. All contentions from the writ petition were left open for future consideration.