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2021 (2) TMI 381 - HC - GSTDetention of vehicle alongwith goods - mistake in E-way bill - E-way bill in which by mistake erroneously entered its own name in the column of consignee - levy of tax and penalty - HELD THAT - A circular was issued, vide No.CBEC/20/16/03/2017-GST, dated 14-9-2018 by the Ministry of Finance, appended as Annexure-P/15 to the writ petition, specifically stating that it has been informed that proceedings under Section 129 of the GST Act are being initiated for every mistake in the documents mentioned in para 3 of the said Circular. It is clarified that in case, a consignment of goods is accompanied with an invoice or any other specified documents and not with an E-way bill, proceedings under Section 129 of the GST Act may be initiated. Para 5 of the Circular further clarifies, that in case a consignment of goods is accompanied with an invoice or any other specified document and also with an E-way bill, proceedings under Section 129 of the GST Act may not be initiated. It is strenuously urged that the respondent/Appellate Authority is not justified in rejecting the appeal on the ground that the petitioner has not discharged its liability of payment of IGST Tax at the time of import. It is put forth that the point raised on behalf of the respondents, is totally incorrect because at the time of making of a Bill of Entry for home consumption, vide No.8870378, dated 15-11-2018, the IGST for a sum of ₹ 1112134/- was paid accordingly along with Custom Duty. The respondents are not justified in rejecting the appeal of the petitioner on the ground that the mistake committed while generating the E-way bill, was not a clerical error or a small mistake - the impugned orders passed by the respondents, confirming the tax and penalty to the tune of ₹ 2224268/-, are hereby quashed - Petition allowed.
Issues:
Challenge to imposition of tax and penalty based on incorrect E-way bill information. Analysis: The petitioner, a registered taxpayer under GST, imported machine parts from the USA, with a mistake in the E-way bill recipient's name. The State Tax Officer detained the goods and imposed tax and penalty. The appeal to the Joint Commissioner was rejected, upholding the tax and penalty. The petitioner argued that the mistake in the E-way bill was inadvertent and not fraudulent. Despite carrying all required documents during transportation, proceedings under Section 129 of the GST Act were initiated, leading to the tax and penalty imposition. Reference was made to Section 126 of the GST Act, emphasizing that penalties should not be imposed for minor breaches or easily rectifiable mistakes. The petitioner contended that the mistake in the E-way bill was a procedural error without fraudulent intent, as acknowledged in the impugned order. The petitioner highlighted a circular issued by the Ministry of Finance, which addressed minor discrepancies in E-way bills and emphasized that penalties should not be imposed for such errors. The petitioner argued that the rejection of the appeal based on non-matching consignee names was unjust, as all other details in the E-way bill aligned with related documents. The High Court, after considering the arguments and relevant provisions of the GST Act, found the rejection of the appeal unjustified. The court quashed the orders confirming tax and penalty, directing the authorities to consider imposing a minor penalty for the clerical mistake, in line with the circular issued by the Ministry of Finance. In conclusion, the writ petition was allowed, and no costs were imposed. The court emphasized the need to differentiate between minor errors and deliberate violations, directing authorities to treat the petitioner's case as a clerical mistake and not a serious offense.
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