2021 (12) TMI 231 - HC - GST

Seizure of goods - genuineness of invoices - Contention of the learned counsel for the petitioner is that at the time of interception, admittedly, certain invoices could not be produced by the driver before the intercepting authority - HELD THAT - The learned Standing Counsel has not been able to deny that despite the petitioner claiming himself to be the owner and having produced invoices concerned, he was not declared by the proper authority or the appellate authority to be the owner of the goods. The matter requires consideration - Learned Standing Counsel prays for and is granted three weeks time to file counter affidavit. Rejoinder affidavit, if any, may be filed within two weeks thereafter.

Summary

Issues:
Challenging orders under IGST Act and CGST Act, genuineness of invoices, liability for penalty under Section 129(1)(a) vs. 129(1)(b), determination of goods' owner.

Analysis:
The judgment concerns a writ petition challenging orders passed under the IGST Act and CGST Act. The petitioner contested an order passed by the Assistant Commissioner under Section 20 of the IGST Act, along with an order in appeal by the Additional Commissioner under Section 107 of the GST Act. The petitioner argued that despite not producing certain invoices during interception, all invoices were later submitted in response to a show cause notice. The petitioner relied on Circular No. 76/50/2018 GST to assert that as the invoices were produced, they should be deemed the owner of the goods under Section 129(1) of the CGST Act. However, both the proper officer and the appellate authority doubted the genuineness of the invoices without determining the owner of the goods, as required by the circular.

The petitioner contended that their liability for penalty should fall under Section 129(1)(a) of the Act, not 129(1)(b), as they had produced the invoices and offered to pay tax and penalty. The Standing Counsel opposed the petition, claiming the invoices were suspect, justifying the penalty under Section 129(1)(b). However, it was acknowledged that neither authority declared the petitioner as the owner of the goods, despite their claim and invoice submission. The court noted the need for further consideration and granted time for filing counter affidavit and rejoinder.

Given the arguments and record examination, the court decided that as the petitioner had not been declared the owner of the goods and had offered to pay the penalty, the goods would be released upon payment of the penalty under Section 129(1)(a) and providing security for the remaining amount as determined by the proper officer in the impugned order. The judgment reflects a detailed analysis of the issues surrounding the genuineness of invoices, liability for penalty, and the determination of the goods' owner under the relevant provisions of the Acts and circulars.