2022 (6) TMI 196 - HC - GST

Directing release of the petitioners vehicle - Levy of maximum penalty of 50% of the value of the goods or 200% tax payable, whichever is higher - petitioners submitted sufficient documents to raise a prima facie presumption of the petitioners being the owner of the goods - HELD THAT - Since factual disputes, in respect of the authenticity of the ownership of the petitioners, and the legal question as to the applicability of the Central and the State Acts parallelly or one, in exclusion of the other, have been raised, such adjudication would be de hors the scope of the present appeal. Since it is within the domain of the first Court of learned single Judge, while deciding the writ petition, to adjudicate such questions on merits, even if the single Judge assumes jurisdiction in the teeth of availability of an alternative remedy by way of appeal, it is not intended to usurp such jurisdiction of the learned single Judge in the present appeal, which has been preferred against an interlocutory order. There are no error in the impugned order to justify interference in an intra-court appeal. Application dismissed.

Summary

Issues:
Interpretation of Section 129 (1)(a) (b) of the West Bengal Goods and Service Tax Act, 2017; Ownership of the goods and applicability of penalties; Jurisdiction of the respondent-authorities in charging penalties; Detention of vehicles and goods by the Bureau of Investigation; Scope of interference with the impugned order of the learned single Judge; Adjudication of factual disputes and legal questions regarding the Acts; Dismissal of MAT 40 of 2022 along with CAN 1 of 2022.

Interpretation of Section 129 (1)(a) (b) of the West Bengal Goods and Service Tax Act, 2017:
The appellants argued that the learned single Judge should have granted an interim order for the release of the petitioners' vehicle upon payment of 50% of the value of the goods or 200% tax payable, whichever is higher, as per the amended Section 129 (1)(a) (b) of the Act. They contended that the penalty charged should not exceed this limit, even if the owner of the goods does not come forward for payment. The respondent-authorities, however, insisted on payment of 100% of the value of the goods, which the appellants deemed as a transgression of jurisdiction under the Act.

Ownership of the goods and applicability of penalties:
The petitioners claimed ownership of the goods by submitting sufficient documents to raise a prima facie presumption. Despite this, the respondent-authorities questioned the existence and veracity of the petitioners. The appellants relied on a previous judgment for the release of goods based on the amended provision of Section 129 (1) of the Act. The respondent-authorities argued that penalties could be charged up to 100% of the value of goods, considering contraventions of both State and Central Acts.

Jurisdiction of the respondent-authorities in charging penalties:
The respondent-authorities defended their actions by stating that the penalty imposition was justified under both the State and Central Acts. They clarified the methodology of penalty calculation in the impugned order, emphasizing that the Bureau of Investigation, responsible for the detention of the vehicles and goods, was not bound by the restrictions of Section 129 of the Act.

Detention of vehicles and goods by the Bureau of Investigation:
The detention of the vehicles and goods was carried out by the Bureau of Investigation, which was argued to have a different jurisdiction compared to the assessing authority under the Act. This distinction was highlighted to justify the penalty imposition and detention of goods.

Scope of interference with the impugned order of the learned single Judge:
The High Court concluded that there was no basis for interference with the impugned order of the learned single Judge at that stage. The Court refrained from delving into factual disputes regarding ownership authenticity and the legal question of Acts' applicability, stating that such adjudication fell within the first Court's jurisdiction.

Adjudication of factual disputes and legal questions regarding the Acts:
The Court highlighted that the resolution of factual disputes and legal questions concerning the Acts should be addressed by the learned single Judge during the writ petition's adjudication. The Court dismissed the appeal against the interlocutory order, emphasizing that the learned single Judge should decide all relevant questions without influence from the current observations.

Dismissal of MAT 40 of 2022 along with CAN 1 of 2022:
The Court dismissed MAT 40 of 2022 along with CAN 1 of 2022, clarifying that they had not delved into the merits of the parties' contentions. The learned single Judge was urged to expedite the decision on the writ petition to address the appellants' urgency due to ongoing losses from the detention of the vehicle and goods. No costs were awarded in the judgment.