2022 (3) TMI 541 - HC - GST

Seizure of goods alongwith the conveyance - intention on the part of the writ applicant to evade tax or not - HELD THAT - Let Notice be issued to the respondents returnable on 23 rd February 2022. Mr. Sharma the learned A.G.P. waives service of notice for and on behalf of the respondents. Since the writ applicant has already deposited an amount of 3, 60, 352/- towards tax and penalty we order provisional release of the goods and conveyance pending the confiscation proceedings. The writ applicant shall file an undertaking on oath with the concerned authority that in the event if the goods and vehicle is confiscated by way of a final order that may be passed under Section 130 of the Act then he shall pay the redemption fine with interest subject to his right to challenge such order by way of an appeal before the appellate authority under Section 107 of the Act. The two issues raised by the learned counsel appearing for the writ applicant on merits shall be considered on the returnable date.

Summary

Issues: Challenge to show cause notices in Form GST MOV-10 and Form GST MOV-06, compliance with statutory procedure for communicating show cause notice under Rule 142(1) of the G.S.T. Act, provisional release of goods and conveyance pending confiscation proceedings.

Challenge to Show Cause Notices in Form GST MOV-10 and Form GST MOV-06:
The judgment pertains to a challenge against a show cause notice dated 20th December 2021 in Form GST MOV-10 and another notice in Form GST MOV-06. The petitioner claimed ownership of goods, specifically TMT bars, being transported in a truck to Chandisar, Palanpur. However, upon interception by the mobile squad, it was observed that the goods were en route to Chandisar for delivery, not at Chandisar. The petitioner argued that the department lacked sufficient grounds to issue the show cause notice and highlighted non-compliance with the statutory procedure for communicating such notices under Rule 142(1) of the G.S.T. Act. The petitioner contended that there was no indication of tax evasion and emphasized the necessity of following the prescribed procedure for communicating show cause notices.

Compliance with Statutory Procedure for Communicating Show Cause Notice under Rule 142(1) of the G.S.T. Act:
The petitioner's counsel argued that the Revenue failed to adhere to the statutory procedure outlined in Rule 142(1) of the G.S.T. Act for communicating show cause notices or orders. It was emphasized that the provision mandates the department to upload such notices on the Revenue's website to ensure transparency and enable the aggrieved party to understand the reasons behind the demand. The counsel asserted that strict adherence to the prescribed procedure is essential, as deviation from it could invalidate the notice. Moreover, the petitioner had already deposited a substantial amount towards tax and penalty, indicating a willingness to comply with the process.

Provisional Release of Goods and Conveyance Pending Confiscation Proceedings:
Considering the petitioner's deposit of a significant sum towards tax and penalty, the Court ordered the provisional release of the goods and conveyance pending confiscation proceedings. The petitioner was directed to provide an undertaking to the concerned authority, pledging to pay the redemption fine with interest if the goods and vehicle were ultimately confiscated under Section 130 of the Act. This provisional release was subject to the petitioner's right to challenge any confiscation order through an appeal before the appellate authority under Section 107 of the Act. The Court scheduled a further hearing to address the substantive issues raised by the petitioner's counsel.

In conclusion, the judgment addresses the challenge against show cause notices, emphasizes compliance with statutory procedures for communicating such notices, and orders the provisional release of goods and conveyance pending confiscation proceedings, subject to specified conditions and undertakings by the petitioner.