2021 (2) TMI 237 - HC - GST

Confiscation of goods or conveyance and levy of penalty under Section 130 of the GST Act - Section 129(1) of the GST Act - HELD THAT - It is expected that the writ-applicant now to participate in the proceedings initiated by the authority for the purpose of confiscation of the goods and the vehicles. The writ-applicant shall file his reply and shall make his case good for the purpose of getting notice discharged in MOV-10. Ultimately, if the final order of confiscation is passed under Section130 of the Act, then the writ-applicant will have the remedy to file an appeal under Section 107 of the Act. This writ-application stands disposed of.

Summary

Issues:
1. Detention and confiscation of goods and conveyance under GST Act
2. Requirement of e-way bill for transportation of goods
3. Release of detained goods and conveyance subject to payment of tax and penalty

Issue 1: Detention and confiscation of goods and conveyance under GST Act
The writ-applicant sought relief through a writ of mandamus to quash the order of detention under Section 129(1) of the GST Act and the notice for confiscation of goods and levy of penalty under Section 130. The applicant argued that the actions of the respondent were illegal, unlawful, and violative of principles of natural justice and the provisions of the Act and Rules framed thereunder. The court noted the submissions made by the petitioner's advocate regarding the non-requirement of an e-way bill for transporting specified goods like jeera and souff as per a relevant notification. An interim measure was passed directing the release of the detained goods upon payment of tax and penalty, subject to a solemn undertaking by the petitioner to cover any deficit liability determined by the authorities. The court emphasized the need for the writ-applicant to participate in the proceedings for confiscation of goods and vehicles, with the right to challenge decisions in accordance with the law. The final order clarified that the writ-application was disposed of without expressing an opinion on the merits of the case, leaving the authority to pass appropriate orders based on merit.

Issue 2: Requirement of e-way bill for transportation of goods
The court referenced a notification exempting the need for an e-way bill for specified goods, including fennel and cumin, which were being transported by the petitioner. Despite this exemption, the goods and conveyance were detained for not presenting an e-way bill. The court acknowledged the petitioner's argument based on the notification and directed the release of the goods upon payment of tax and penalty, subject to certain conditions and undertakings. This issue highlights the importance of understanding and applying relevant notifications and exemptions under the GST Act to avoid unnecessary detentions and confiscations of goods during transportation.

Issue 3: Release of detained goods and conveyance subject to payment of tax and penalty
In response to the petitioner's plea for relief, the court ordered the release of the detained goods and conveyance upon payment of the tax and penalty calculated by the authorities. The release was subject to the petitioner filing a solemn undertaking to cover any potential deficit liability determined in the future. This decision emphasized the importance of complying with tax and penalty obligations while providing an avenue for the petitioner to challenge any determinations made by the authorities in accordance with the law. The court's order aimed to balance the interests of the petitioner with the requirements of the GST Act regarding the release of detained goods and conveyance.

This detailed analysis of the judgment issued by the Gujarat High Court provides insights into the legal aspects surrounding the detention, confiscation, and release of goods and conveyance under the GST Act, emphasizing the need for compliance with relevant provisions and notifications to avoid legal disputes and ensure proper application of the law.