2022 (4) TMI 978 - HC - GST

Provisional release of goods along with conveyance - Seeking direction to first respondent to accept the bank guarantee equivalent to the disputed penalty - Section 129(1)(c) of the CGST Act, 2017 - HELD THAT - This Court permits the petitioner to obtain and annex the bank guarantee within a period of one week from the date of receipt of a copy of this order along with the application/representation. If such bank guarantee and application is made, the respondents are directed to release the detained goods to the petitioner within a period of one week thereafter. Petition disposed off.

Summary

Issues:
1. Issuance of a Writ of Mandamus directing acceptance of bank guarantee for disputed penalty amount.
2. Detention of goods imported by the petitioner.
3. Confirmation of penalty under Section 129(1)(a) of the CGST Act, 2017.
4. Request for release of goods by furnishing a bank guarantee.
5. Delay in passing an order on the petitioner's representation.
6. Court's direction on accepting the bank guarantee and releasing the detained goods.

Analysis:
1. The petitioner, a leading paint manufacturer, imported goods and faced detention by the second respondent, leading to a penalty under Section 129(1)(a) of the CGST Act, 2017. The petitioner challenged the detention order through Writ Petitions, seeking release of the goods bearing a specific registration number. The court directed the petitioner to raise all points before the adjudicating authority and ordered the respondents to decide within two weeks after a hearing.

2. Following the detention, the petitioner objected to the detention and later made a representation requesting the release of goods upon furnishing a bank guarantee equivalent to the penalty amount. Despite the representation, the first respondent confirmed the penalty. The petitioner, aggrieved by the delay in response, filed the current Writ Petition seeking relief.

3. The petitioner's counsel argued for the acceptance of a bank guarantee in accordance with Section 129(1)(c) of the CGST Act, 2017, to secure the disputed penalty amount and release the detained goods promptly. The Additional Government Pleader representing the respondents agreed to release the goods upon receipt of the bank guarantee and the petitioner's representation.

4. The court, considering the submissions, permitted the petitioner to provide the bank guarantee within a week of receiving the court's order. Upon submission of the bank guarantee and application, the respondents were directed to release the detained goods to the petitioner within a week thereafter. The court disposed of the Writ Petition with no costs, emphasizing the fulfillment of the directed actions for the release of goods.

This judgment highlights the legal process involved in challenging detention orders, confirming penalties under tax laws, and seeking relief through the issuance of a Writ of Mandamus for the release of goods upon furnishing a bank guarantee as per statutory provisions.