2022 (9) TMI 619 - HC - VAT and Sales Tax

Maintainability of petition - appealable orders - stay on auction proceedings - whether goods being unloaded/stored was not the place where the products were intended to be transported the goods? - seizure of such goods - HELD THAT - Admittedly, the impugned orders passed are appealable under Section 107 of the KGST Act/CGST Act and the petitioner has an alternative efficacious remedy of appeal. Hence, the writ petition is liable to be dismissed reserving liberty to the petitioner to approach the Appellate Authority in accordance with law. However, taking into consideration that 06.07.2002 is fixed as date for opening of bids, if some interim protection is not granted to the petitioner, the entire proceedings and the appeal it may file challenging the impugned orders would become infructuous. The writ petition is dismissed reserving liberty to the petitioner to approach the appropriate forum and challenge the impugned orders in accordance with law.

Summary

Issues: Seizure of goods under KGST Act/CGST Act, appealability of impugned orders, alternative efficacious remedy under Section 107 of KGST Act/CGST Act, interim protection for petitioner

The judgment by the High Court of Karnataka pertains to a writ petition filed by a proprietary concern engaged in trading Pan Masala and Tobacco products. The petitioner's goods were seized by authorities under Section 130 of the KGST Act/CGST Act during transportation and storage, leading to auction proceedings scheduled for 6th July 2022. The petitioner contended that the seizure was unjust as it had leased a godown near Malur for business expansion, even though permission was granted after the seizure. The petitioner argued that the goods were not diverted, all duties and taxes were paid, and the orders were passed without proper consideration of facts. The petitioner sought to set aside the impugned orders issued by the authorities.

The respondents, represented by the Additional Government Advocate, raised doubts about the transportation of goods from Bengaluru and highlighted disputes on facts that could not be addressed in writ proceedings. They emphasized the perishable nature of the goods and the need for immediate auction to realize the highest value. The respondents argued that the petitioner had an alternative efficacious remedy under Section 107 of the KGST Act/CGST Act, making the impugned orders appealable. They requested the dismissal of the writ petition.

The High Court acknowledged that the impugned orders were appealable under Section 107 of the KGST Act/CGST Act, providing the petitioner with an alternative remedy through appeal. Despite this, the Court recognized the impending auction and the risk of the petitioner's appeal becoming infructuous if interim protection was not granted. Consequently, the Court dismissed the writ petition but directed that the auction proceedings should not be finalized until 27th July 2022, allowing the petitioner time to approach the appropriate forum and challenge the impugned orders within the legal framework.