2019 (11) TMI 343 - HC - GST

Detention Order - invalid E-way bill - vehicle was plying in the wrong direction - demand of tax and penalty without affording the petitioner an opportunity of being heard - principles of Natural Justice - CGST and SGST Acts - HELD THAT - At the time of detention the driver of the vehicle did not produce any e-Way Bill, either manual or electronic, corresponding to the goods that were carried on in the vehicle. It is further pointed out that a statement was given by the driver before the authorities wherein he had stated that there was no e-Way Bill with him. Under the said circumstances, prima facie there appears to be a justification for the detention of the vehicle. Further, there was no opportunity granted to the petitioner to rebut the inferences drawn by the authorities while detaining the goods, through a hearing afforded to the petitioner before passing Ext.P11 order confirming the demand of tax and penalty on the petitioner. The 1st respondent is directed to pass fresh orders in lieu of Ext.P11 within a week from the date of receipt of a copy of this judgment, after hearing the petitioner - petition allowed by way of remand.

Summary

Issues:
Challenge against Ext.P10 order of detention and Ext.P11 adjudication order under CGST and SGST Acts.

Analysis:
The petitioner challenged the detention order and subsequent tax and penalty imposition under CGST and SGST Acts, arguing that the grounds for detention were flawed as an e-Way Bill was actually available with the driver at the time of interception. The petitioner contended that Ext.P11 order confirming the tax and penalty was passed without granting an opportunity to be heard.

Upon hearing both parties, the court noted that the driver did not produce any e-Way Bill during detention, and the driver's statement supported this. The court acknowledged a prima facie justification for detention but emphasized the lack of opportunity for the petitioner to rebut the authorities' inferences before passing the tax and penalty order.

Consequently, the court quashed the Ext.P11 order and directed the 1st respondent to issue fresh orders within a week after hearing the petitioner. The new order must address the petitioner's claim of producing an e-Way Bill and provide reasons for the decision. The petitioner can seek release of goods by providing a bank guarantee for the detained amounts and must submit the writ petition and judgment copy to the 1st respondent for further action.