2023 (3) TMI 58 - HC - GST

Detention of goods alongwith vehicle - Misuse of E-Way Bill - Cancellation of E-way Bill - once the goods were not dispatched on the same day - Rule 139(9) of CGST Rules - evasion of GST taking place or not - HELD THAT - From the findings recorded by the taxing authorities it is clearly evident that vehicle no.NL01N/6504 was not only used by Bombay Kandla Transport (P) Ltd. through which goods were sent by the petitioner-dealer but also by Bombay Kolkata Logistics for sending fruits and vegetable to Panchkula and by Delhi Hemkunt Logistics for sending rice to Darbhanga (Bihar). Once the vehicle was not available on 08.04.2018 and was used for transporting fruits and vegetable and its journey commenced on 07.04.2018 the case set up by the petitioner cannot be accepted and has rightly been denied by the authorities. It is clear that the goods were sent on 07.04.2018 to West Bengal through the vehicle in question and thereafter on 12.04.2018 to Darbhanga (Bihar). Filling the details of the vehicle and transporter in Part-B of Form GST EWB-01 completely belie the story set up by the petitioner before the authorities - Moreover the finding recorded by the Appellate Authority that Darbhanga Dealer to whom it is alleged that rice was sent had denied such transaction as the firm having already closed down two months prior to the transactions which corroborates the facts that through tax invoice and E-Way Bill generated on 08.04.2018 the dealer has made several transactions and evaded tax. The Chart given in para 7 of the counter affidavit reflects movement of the vehicle through various Toll Plazas on relevant dates and is a establishment of fact that number of trips were made from Delhi to other places through one and the same document and also through one and the same vehicle. This Court therefore finds that there has been a complete misuse of statutory provision of the Act and Rules by the dealer. The inference drawn by the taxing authorities after interception of goods on 18.04.2018 needs no interference by this Court - Petition dismissed.

Summary

Issues:
Challenge to order under Section 129(3) of the U.P. Goods and Service Tax Act, 2017 based on seizure of goods during transportation; Dispute over E-Way Bill generation and cancellation; Allegations of tax evasion and misuse of statutory provisions.

Analysis:
The petitioner, a registered dealer, challenged an order dated 15.05.2018 under Section 129(3) of the U.P. Goods and Service Tax Act, 2017, regarding the seizure of goods during transportation. The petitioner sold Pan Masala to a dealer in Meghalaya, generating a tax invoice under the IGST Act charging 28% IGST and 60% Cess. The goods were handed over to a transporter, and an E-Way Bill was generated on 08.04.2018. The vehicle used had prior trips transporting fruits, vegetables, and rice. The goods were intercepted on 18.04.2018, leading to a seizure order with penalties. The petitioner argued that all necessary documents were present during transportation, and there was no tax evasion.

The State, opposing the petition, highlighted discrepancies in the transportation details. The E-Way Bill and transporter bill indicated prior trips not consistent with the current transportation. The State emphasized Rule 138(9) of the CGST Rules 2017, stating that E-Way Bills should be cancelled if goods are not transported as per details furnished. The State contended that the petitioner misused the E-Way Bill and engaged in multiple transactions based on a single document.

The Court examined the case, noting that the E-Way Bill was generated on 08.04.2018, but the vehicle had prior trips before transporting the Pan Masala. The Court emphasized the importance of accurate details in the E-Way Bill and the provision for cancellation if goods are not moved as per the bill. The Court found discrepancies in the petitioner's claims and the actual transportation history of the vehicle. The Court upheld the taxing authorities' decision, concluding that there was a misuse of statutory provisions and evasion of tax by the dealer.

In the final judgment, the Court dismissed the writ petition, affirming the seizure order and penalties imposed. The Court concluded that the dealer's actions constituted a misuse of statutory provisions, leading to tax evasion. The Court upheld the decision of the taxing authorities, finding no grounds for interference in the case.