2022 (8) TMI 756 - HC - GST

Seeking release of detained vehicle alongwith goods - expired E-way bill - Section 129 of CGST Act and Rule 68 of CGST Rules - HELD THAT - A bare perusal of the provisions of Section 129 shows that no goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the goods on the allegation of making transit in contravention of the provisions of the Act or Rule made thereunder. Apparently, the proceedings have been initiated on the same date and concluded also on the same date. Though, learned counsel for the respondent has stated that the proceedings were expedited at the instance of the tax payer on the same date, but there is nothing to substantiate such contention. The impugned adjudication order and the appellate order therefore both suffer from procedural infirmities and lack of proper opportunity to the petitioner or the person transporting to defend himself. The impugned order is set aside - petition allowed.

Summary

Issues: Alleged violation of Section 129 of CGST Act, 2017

Detailed Analysis:

1. Alleged Violation of Section 129:
The case involved an alleged violation of Section 129 of the Central Goods and Services Tax Act, 2017, related to the detention, seizure, and release of goods and conveyances in transit. The vehicle in question was intercepted due to an expired E-Way bill, leading to subsequent proceedings, including the issuance of notices and adjudication orders. The petitioner contended that the proceedings were held ex parte without providing a proper opportunity for a reply or hearing. The petitioner argued that there was no intention to evade tax, citing a Supreme Court decision supporting this claim.

2. Respondent's Counter Affidavit:
The respondents filed a counter affidavit stating that the vehicle was intercepted as the E-Way bill had expired, and no extension was sought. They highlighted that a notice with a seven-day reply period was served, but the authorized person did not appear. The vehicle was released upon payment of tax and interest, as the taxpayer did not provide any submission. The respondent argued that the intention to evade tax was not necessary under Section 129 for imposing liability.

3. Legal Analysis of Section 129:
The court analyzed Section 129 of the CGST Act, which outlines the detention, seizure, and release of goods and conveyances. The section mandates that no goods or conveyance shall be detained or seized without serving an order to the person transporting the goods. It also specifies timelines for issuing notices, passing orders for penalties, and the consequences of non-payment. The court noted that the proceedings in this case were initiated and concluded on the same date, raising procedural concerns.

4. Court Decision:
After considering the submissions and provisions of Section 129, the court found procedural infirmities in the adjudication order and the appellate order. The court set aside the impugned orders but allowed the respondents to take a fresh decision after providing due opportunity to the petitioner as per the Act. The writ petition was allowed in favor of the petitioner to the extent indicated in the judgment.

In conclusion, the judgment addressed the alleged violation of Section 129 of the CGST Act, emphasizing procedural fairness and the importance of providing opportunities for defense in such cases. The court's decision highlighted the need for proper adherence to legal procedures and the opportunity for parties to present their case effectively.