2020 (7) TMI 609 - HC - GST

Release of detained goods along with vehicle - Section 129 and Section 130 of the GST Act - HELD THAT - If the writ applicants are ready and willing to deposit the amount as stipulated above then we may consider releasing the goods as well as the conveyance with a further liberty to prefer appeal under Section 107 of the CGST Act, 2017, against the final order of confiscation having regard to the fact that the impugned order of confiscation was served upon the writ applicants in the month of March, 2020. As the writ applicants are ready and willing to deposit the amount towards their liability, following order is passed - (i) The writ applicants shall deposit 50% of ₹ 36 Lac with the respondent No.3 and the balance amount of ₹ 18 Lac shall be paid by way of a Bank Guarantee of any nationalized bank. This shall be done within a period of two weeks from today. (ii) If the amount of ₹ 36 Lac as referred to above is paid to the respondent No.3 then the conveyance as well as the goods shall be immediately released in favour of the writ applicants. (iii) It shall be open for the writ applicants to prefer an appropriate appeal before the appellate authority under Section 107 of the Act, if they intend to question the legality and validity of the order of confiscation passed in Form MOV-11. If any such appeal is preferred, the appellate authority shall hear the same in accordance with law. ( iv) We clarify that we have not expressed any opinion on the merits of the case. We have passed this order keeping in mind that the goods are of perishable nature and are lying with the respondent No.3 since the month of September, 2019. Application disposed off.

Issues:
1. Writ application under Article 226 for certiorari and mandamus relief.
2. Detention of goods and vehicle under Section 129(1) of the CGST Act, 2017.
3. Order of confiscation in form MOV-11.
4. Decision to auction goods and vehicle for tax recovery.
5. Appealability of the final order of confiscation under Section 107 of the CGST Act, 2017.
6. Entertaining writ application at the last minute before auction finalization.
7. Conditions set for releasing goods and vehicle pending appeal.
8. Payment of 50% liability to release goods and vehicle.
9. Disposal of the writ application based on payment terms.

Analysis:
1. The writ applicants sought certiorari to quash the confiscation order and mandamus to release goods and vehicle without security. The goods were detained under Section 129(1) of the CGST Act, 2017 due to document deficiencies. Subsequently, an order of confiscation in form MOV-11 was issued.

2. The authority decided to auction the goods and vehicle for tax recovery, prompting the writ applicants to approach the court last minute. The court emphasized the appeal remedy under Section 107 of the CGST Act, 2017, despite the counsel's limitation argument for filing an appeal.

3. The State respondents highlighted the writ applicants' delayed action and the auction's off-set price exceeding the liability. The court proposed a payment arrangement for releasing the goods and vehicle pending appeal, requiring 50% payment and a bank guarantee.

4. Upon the writ applicants' agreement to deposit 50% of the liability and provide a bank guarantee, the court ordered the payment terms for release. The court clarified that it did not express any opinion on the case's merits, considering the perishable nature of the goods and the prolonged detention since September 2019.

5. The writ application was disposed of based on the agreed payment terms, allowing the writ applicants to appeal the confiscation order under Section 107 of the Act. The court's decision aimed to balance the interests of tax recovery and the writ applicants' right to appeal, ensuring the release of perishable goods while upholding legal procedures.

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