2023 (7) TMI 93 - HC - GST

Levy of penalty - transportation of the vehicle in contravention of Section 129 of GST Act - HELD THAT - This Court is of the view that the vehicle, which was carrying the excavator and the excavator could not be kept under detention as it will deteriorate the value of both the vehicles and it will be counter productive as the appellant will not be able to repair and use the vehicle. Consequently, he will be declared as a defaulter in payment of the monthly instalments to the bank and the net result would be even assuming that the order of penalty is to be upheld, it will continue to remain as a paper work. The release of the vehicle shall be done within three days from the date on which the appeal is filed before the appellate authority and the pre-deposit is made and the requisite challan is produced before the detaining authority. Appeal disposed off.

Summary

Issues Involved:
The issues involved in the judgment include challenging an order imposing penalty for contravention of Section 129 of the Act, the appellant's ownership and transportation of an excavator, and the directive to file an appeal before the appellate authority.

Challenging Penalty Order:
The appellant filed a writ petition against an order levying a penalty for transporting an excavator in contravention of Section 129 of the Act. The appellant contended that the excavator was purchased with financial assistance from a bank under a hypothecation agreement, preventing its sale. The excavator was being used for job works and was being transported for repairs when intercepted. The Court acknowledged the necessity of the appellant availing the remedy of appeal for factual issues. However, considering the potential deterioration of both vehicles if detained, the Court directed the appellant to file an appeal, make a pre-deposit, and undertook not to sell the excavator until the appeal's disposal. The vehicles would be released upon compliance within three days of filing the appeal.

Appellate Authority Directive:
The learned Single Bench dismissed the writ petition, emphasizing the need for the appellant to approach the appellate authority. The Court recognized the importance of factual issues being addressed through the appeal process. Despite upholding the direction to file an appeal, the Court highlighted the detrimental impact of detaining the vehicles on the appellant's ability to use and repair them. To avoid financial default and maintain the vehicles' value, the Court allowed for the release of both vehicles upon filing the appeal, making the pre-deposit, and providing an undertaking not to sell the excavator during the appeal's pendency. The release was to be completed within three days of fulfilling the necessary requirements.

Conclusion:
The appeal, along with the relevant application, was disposed of with the directive for the appellant to file an appeal before the appellate authority, make a pre-deposit, and ensure the vehicles' release within three days of filing the appeal. No costs were awarded, and the parties were to receive a certified copy of the order promptly upon completing all legal formalities.