2021 (4) TMI 273 - HC - GST

Detention of goods alongwith the vehicle - e-way bill was in order - petitioner claims that he is the owner of the goods and therefore the penalty amount cannot exceed the amount of tax - petitioner has already deposited twice the amount of tax towards penalty - HELD THAT - It does appear that the interest of revenue is secure, in-as-much as sufficient amount has been deposited towards the penalty and also 30% of the tax amount is deposited in hard cash. At this stage, learned counsel for the petitioner states that the petitioner is willing to deposit the balance 70% of the amount of tax in cash. Accordingly, the petitioner is permitted to deposit 70% of the demand of tax payable on the goods as a further condition to obtain the release of the vehicle and goods. Application is disposed of with the observation, subject to the petitioner depositing 70% of the amount of tax, the goods and the vehicle shall be released forthwith.

Summary

Issues:
1. Interpretation of e-way bill regulations during transit through the State of U.P.
2. Requirement of security for the balance amount of tax for releasing goods.
3. Dispute regarding penalty amount exceeding the tax amount.
4. Release of goods and vehicle pending tax payment.

Interpretation of e-way bill regulations during transit through the State of U.P.:
The writ petition was entertained concerning the transit of goods through U.P. from Assam to Delhi. The petitioner argued that the e-way bill was in order, and the goods matched the description on the tax invoice. Reference was made to a circular advising authorities not to examine beyond the e-way bill. The court acknowledged the matter required consideration, granting time for filing affidavits and issuing notice to respondents. The petitioner was directed to deposit tax amounts for release under Section 129(1)(a) of the Uttar Pradesh Goods & Services Tax Act, 2017.

Requirement of security for the balance amount of tax for releasing goods:
A subsequent correction application was allowed to include the term "and vehicle" after "goods" in the original order. A clarification application was filed as the goods and vehicle were not released despite prior deposits. The petitioner contested the demand for security in the form of immovable property for the remaining tax amount. The petitioner claimed ownership of the goods, arguing that the penalty should not exceed the tax amount. Despite previous deposits, the respondents insisted on further security. The court permitted the petitioner to deposit the remaining 70% of the tax in cash to secure the release of the goods and vehicle.

Dispute regarding penalty amount exceeding the tax amount:
The petitioner raised concerns about the penalty amount exceeding the tax paid, asserting that revenue interests were safeguarded with the deposited penalty and 30% of the tax in cash. The petitioner expressed willingness to pay the remaining 70% of the tax in cash. The court disposed of the clarification application, stipulating that upon depositing the 70% tax amount, the goods and vehicle would be released promptly.

Release of goods and vehicle pending tax payment:
The judgment addressed the release of goods and vehicles detained during transit, emphasizing compliance with tax payment requirements and the provision of security as per the relevant tax laws. The court balanced the interests of the petitioner and revenue authorities, allowing for the release of goods upon fulfilling the specified tax payment conditions.