2023 (2) TMI 721 - HC - GST

Levy of tax and penalty - Failure to produce E-way Bill for certain items - tax and penalty were imposed only upon the goods which were not accompanied with any document i.e. GRs Invoices and/or E-way bills. - all the invoices carried by driver were not accepted to be complete and accurate due to non-production of E-way bills - complete set of invoices were submitted with the Appellate Authority later on - HELD THAT - Pursuant to 101 of Amendment of the Constitution three enactments were passed by the Parliament i.e. the Integrated Goods and Services Tax Act 2017 the Central Goods and Services Tax Act 2017 the Union Territory Goods and Services Tax Act 2017 - In addition to the aforesaid three enactments the Legislature of the State of Haryana on 08.06.2017 passed an enactment known as the Haryana Goods and Services Tax Act 2017 (HGST Act). In matters of inter-State trade and commerce including import into the territory of India and out of it the IGST Act 2017 applies whereas in matters of intra-State trade and commerce the CGST Act 2017 and the State Goods Services Tax Act apply. Reference was made to the pronouncement of Hon ble High Court of Madhya Pradesh in the case of ADVANTAGE INDIA LOGISTICS PVT. LTD. VERSUS UNION OF INDIA OTHERS 2018 (9) TMI 1417 - MADHYA PRADESH HIGH COURT and Hon ble Allahabad High Court in the case of SATYENDRA GOODS TRANSPORT CORP. THRU. PROP. BHUWAN KOHLI A VERSUS STATE OF U.P. THRU. PRIN. SECY. TAX REGISTRATION OTHERS 2018 (4) TMI 807 - ALLAHABAD HIGH COURT - the two judgments are on the proposition that cross empowerment under Section 4 of the IGST Act 2017 and Section 6 of the CGST Act 2017 means that State Authorities are empowered under the HGST Act 2017 can also enforce the provisions of the CGST Act 2017 or IGST Act 2017. After going through the departmental record the Proper Officer had not imposed taxes and penalty upon the goods which were accompanied with aforesaid 11 invoices and GRs inspite of the fact that 3 invoices are without E-way bills and remaining 8 invoices having E-way bills which were also invalid due to non-entering of Part B or entering different conveyance number. Since from the date of inspection i.e. 08.09.2021 and even before the Appellate Authority invoices of 9 goods and GRs were never produced by the driver when the goods were checked. Moreover the driver had produced only 11 invoices and 11 GRs and 8 E-way bills and out of these 11 invoices even 3 invoices were without E-way bills. Even the remaining 8 invoices having E-way bills were also invalid due to non-entering of Part B or entering different conveyance number still the tax and penalty were not imposed upon the goods which were accompanied with 11 invoices and GRs and tax and penalty were imposed only for non-producing invoices and GRs with respect to 9 items and Polyester Fabric which was found in excess by 11, 300 meters to that shown in the invoice No. 140/06.09.2021 of M/s. Jai Enterprises. Learned counsel for the petitioner has not been able to dispute the fact that invoices relating to 9 items were never produced before the Proper Officer and Polyester Fabric was also found in excess by 11, 300 meters to that shown in the invoice No. 140/06.09.2021. Appeal dismissed.

Issues Involved:
1. Quashing of the order in appeal dated 20.09.2022.
2. Release of goods for which bills were produced.
3. Validity of E-way bills and accompanying documents.
4. Imposition of tax and penalty under GST laws.
5. Compliance with procedural requirements under GST laws.

Detailed Analysis:

Issue 1: Quashing of the Order in Appeal Dated 20.09.2022
The petitioner sought a writ of certiorari to quash the order in appeal dated 20.09.2022. The petitioner, a transporter registered under the GST Act, was transporting goods on 08.09.2021 when the vehicle was intercepted. The driver failed to produce E-way bills, leading to the detention of the vehicle and goods. The appellate authority rejected the appeal, finding the petitioner's claims devoid of merit. The court upheld the appellate authority's decision, noting that the petitioner failed to produce necessary documents and E-way bills, and found no grounds to quash the order.

Issue 2: Release of Goods for Which Bills Were Produced
The petitioner requested the release of goods for which bills were produced. However, during the inspection, it was found that 17 items were without documents, and there was an excess of Polyester Fabric by 11,300 meters. The appellate authority noted that the petitioner failed to produce valid E-way bills and the goods were not properly documented. The court concluded that the goods could not be released as the petitioner did not comply with the documentation requirements.

Issue 3: Validity of E-way Bills and Accompanying Documents
The driver produced 11 goods receipts and corresponding invoices but only 8 valid E-way bills. The documents were found to be improper as:
1. Three invoices/GRs were without E-way bills.
2. Four E-way bills were invalid as Part-B was not entered.
3. Four E-way bills had different vehicle numbers.
The appellate authority did not accept the invoices and GRs submitted later as they were inconsistent with those produced during the inspection. The court agreed with the appellate authority's findings, emphasizing the necessity of valid E-way bills and proper documentation.

Issue 4: Imposition of Tax and Penalty Under GST Laws
Tax and penalty were imposed under Section 129(1)(2) of the Haryana Goods & Service Tax Act, 2017. The petitioner was penalized for transporting goods without proper documentation. The appellate authority upheld the imposition of tax and penalty, noting that the petitioner failed to produce valid documents for several goods and had an excess quantity of Polyester Fabric. The court found no reason to interfere with the tax and penalty imposed, as the petitioner did not comply with the statutory requirements.

Issue 5: Compliance with Procedural Requirements Under GST Laws
The petitioner argued that the driver did not inform the company about the inspection, but the appellate authority found this claim unconvincing. The court noted that the driver and person in charge were present during the inspection and subsequent proceedings. The court emphasized the importance of compliance with procedural requirements under GST laws, including the production of valid E-way bills and proper documentation during transit.

Conclusion:
The court dismissed the appeal, finding it devoid of merit. The petitioner failed to produce necessary documents and E-way bills, and the goods were not properly documented. The imposition of tax and penalty was upheld, and the court emphasized the importance of compliance with procedural requirements under GST laws. No case was made out to quash the order in appeal dated 20.09.2022.

← Previous Next →