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2020 (2) TMI 742 - HC - GSTLevy of penalty and confiscation of goods - section 129(1) of the GST Act - writ applicant availed the benefit of the interim-order passed by this Court and got the vehicle, along with the goods released on payment of the tax amount - HELD THAT - It shall be open for the writ applicant to point out the recent pronouncement of this Court in the case of SSYNERGY FERTICHEM PVT. LTD VERSUS STATE OF GUJARAT 2019 (12) TMI 1213 - GUJARAT HIGH COURT . It is now for the applicant to make good his case that the show cause notice, issued in Form GST-MOV-10, deserves to be discharged - Application disposed off.
Issues:
1. Detention and seizure of goods and vehicle under GST Acts. 2. Invocation of Section 130 without recourse to Section 129. 3. Interpretation of provisions regarding confiscation. 4. Application of mind and justifiability in issuing confiscation notice. 5. Requirements for invoking Section 130 at the threshold. Analysis: 1. The petitioner, engaged in the metal scrap business, faced detention and seizure of goods in transit due to discrepancies in documentation. The respondent initiated proceedings under Section 130 of the GST Act, leading to a writ application seeking relief. The court noted the petitioner's registration and ordered the release of goods upon payment of tax and penalty, allowing the proceedings to continue. 2. The court raised the issue of whether authorities can invoke Section 130 directly without following Section 129 procedures. While acknowledging the ongoing proceedings under Section 130, the court emphasized the petitioner's entitlement to interim relief, highlighting the importance of due process in such cases. 3. Referring to a previous judgment, the court discussed the nature of contraventions warranting confiscation under Section 130. It emphasized the need for authorities to assess contraventions closely and determine intent to evade tax before resorting to confiscation. The judgment underscored the penal nature of confiscation and the deterrent purpose it serves in tax evasion cases. 4. The court emphasized the significance of authorities applying their minds and having justifiable grounds before issuing confiscation notices. It criticized the practice of issuing confiscation notices without proper evaluation, rendering Section 129 ineffective. The judgment highlighted the need for authorities to establish a strong case for invoking Section 130 at the initial stage. 5. The court outlined the requirements for invoking Section 130 at the threshold, emphasizing the need for a robust case supported by written reasons. It stressed the importance of transparency in decision-making, requiring authorities to demonstrate a genuine belief in the necessity of confiscation. The judgment highlighted the need for intense application of mind and good faith in invoking Section 130, cautioning against arbitrary or baseless actions. In conclusion, the judgment disposed of the writ application, granting relief to the petitioner while setting guidelines for authorities regarding the invocation of Section 130 and the confiscation of goods and vehicles under the GST Acts.
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