2021 (7) TMI 777 - HC - GST

Maintainability of petition - availability of alternative remedy of appeal - Detention of seized goods - Arecanut - difference in the quantity as per the invoice and the quantity as per the PV - any notice or an opportunity to explain the case was not provided - principles of natural justice - HELD THAT - It is very clear from Section 107(1) of CGST Act that any person aggrieved by any decision can file an appeal. Section 121 of CGST ACt bars any appeal against the order or decision pertaining to seizure or retention of books of accounts, register or other documents. In the case on hand, the order is passed under Section 129 of the CGST Act and the goods seized is Arecanut and it is not in respect of any documents. Therefore, the petitioner has an alternative and efficacious remedy of appeal under Section 107 of the CGST Act. The writ petition is disposed off reserving liberty to the petitioner to file an appeal under Section 107 of the CGST Act before the competent authority.

Summary

Issues:
1. Seizure of goods (Arecanut) under Section 129(1) of the CGST Act.
2. Lack of notice and opportunity to explain before seizing the goods.
3. Competency of the authority passing the order under Section 129 of the CGST Act.
4. Availability of alternative remedy of appeal under Section 107 of the CGST Act.
5. Maintainability of the writ petition due to the existence of an alternative remedy.

Analysis:
1. The petitioner, a trader and consignor of Arecanut, challenged the seizure of goods by the respondent under Section 129(1) of the CGST Act while in transit from Kasargod to Delhi. The petitioner contended that the seizure lacked legal authority as there was no discrepancy in the quantity of goods as per the invoice and physical verification report. The petitioner also argued that the respondent did not provide any notice or opportunity to explain before seizing the goods, violating the principles of natural justice.

2. The petitioner's counsel highlighted that the officer passing the seizure order was not a competent authority as defined under the CGST Act. Additionally, the petitioner raised concerns about the lack of appeal remedy under Section 107 of the CGST Act specifically for seizures of goods, as opposed to books of accounts or documents. The petitioner approached the court seeking relief due to the absence of an alternative appeal mechanism for goods seized under Section 129.

3. In response, the respondent argued that the goods were seized by a competent authority in Karnataka and that the petitioner had the option to appeal under Section 107 of the CGST Act. The respondent emphasized that another entity had filed an appeal for a similar seizure, indicating the availability of an alternative remedy through the appellate authority. The respondent contended that the writ petition was not maintainable as the petitioner had not exhausted the appeal process before approaching the court.

4. Upon hearing both parties, the court observed that the petitioner had a statutory right to appeal under Section 107 of the CGST Act within three months of the decision or order communicated. The court noted that Section 121 of the CGST Act restricted appeals related to seizure or retention of documents, not goods like the Arecanut in this case. Acknowledging the existence of an alternative and efficacious remedy of appeal, the court disposed of the writ petition, allowing the petitioner to pursue an appeal before the competent authority under Section 107 of the CGST Act while reserving all contentions of the parties.