2022 (2) TMI 1213 - HC - GST

Release of the goods and the conveyance - requisite amount towards tax and penalty already deposited - Areca Nuts - perishable goods - HELD THAT - It has been brought to our notice that the requisite amount towards tax and penalty aggregating to ₹ 9,55,840/- has already been deposited by the supplier i.e.M/s. Izaan Trading. It appears that the supplier has paid tax twice; first in point of time on 19.11.2021 and second in point of time 18.12.2021 alongwith the penalty. If the amount towards the tax and penalty has already been deposited, there should not any problem in ordering release of the goods and the conveyance. Even otherwise the goods are Areca Nuts. The goods could be said to be perishable in nature. The respondent no.3 is directed to release the goods as well as the conveyance at the earliest. If the Department wants to proceed further with the inquiry, it may do so in accordance with law - application allowed.

Summary

Issues:
Interpretation of Article 226 of the Constitution of India; Detention under Section-129(1) of the CGST Act; Release of goods and conveyance; Payment of tax and penalty; Perishable nature of goods; Quashing of detention order; Issuance of notice under Section-130 of the Act.

Interpretation of Article 226 of the Constitution of India:
The petitioners sought relief under Article 226 of the Constitution of India, praying for the issuance of a writ of mandamus to quash an undated order of detention under Section-129(1) of the CGST Act. The court noted that both writ-applications were inter-related and proceeded to dispose of them together.

Detention under Section-129(1) of the CGST Act:
The case involved the detention of goods worth ?63,70,000 loaded in a conveyance due to alleged deficiencies and illegalities during transit. The court considered a previous order that highlighted the petitioner, a buyer, had not been given an opportunity before the actions were initiated. The relief sought by both the purchaser and the supplier was the release of the goods and conveyance.

Release of Goods and Conveyance; Payment of Tax and Penalty:
The court acknowledged that the supplier had already deposited the required tax and penalty amount with the authority. It was noted that the supplier had paid the tax twice, and considering the perishable nature of the goods (Areca Nuts), the court directed the release of the goods and conveyance by a specified date.

Quashing of Detention Order; Issuance of Notice under Section-130 of the Act:
While the court did not quash the detention order immediately, it left room for the department to issue a notice under Section-130 of the Act in the future. The judgment emphasized that if such a notice is issued, the petitioner could challenge it before the appropriate forum in accordance with the law.

This comprehensive analysis of the judgment highlights the key legal issues addressed by the court, including the interpretation of constitutional provisions, detention under the CGST Act, release of goods, payment of tax and penalty, considerations for perishable goods, and the possibility of future legal actions.