2023 (8) TMI 307 - HC - GST

Seeking release of conveyance and the goods - proceedings to be carried under Section 130 of the CGST Act, or under Section 129 of the CGST Act - HELD THAT - A reading of the post amended Section 130 of CGST Act, extracted above, undoubtedly demonstrates that if a person contravenes any of the provisions of the Act, with an intend to evade payment of tax, then such goods or conveyance are liable to be confiscated and the person is liable to pay damages - Clause (l) of Ext. P11 circular stipulates that where the proper officer is of the opinion that the movement of the goods is being effected to evade payment of tax, he may directly invoke Section 130 of the CGST Act, by issuing notice, proposing to confiscate the goods and conveyance, in Form GST MOV-10. On an appreciation of the pleadings and materials on record, it is evident that it is after issuing MOV 1 and 2, the first respondent had issued Ext. P9 show cause notice in GST MOV-10 under Section 130, directing the petitioner to show cause why the proceedings should not be initiated against him under Section 130 of the GST Act. The petitioner submitted Ext. P10 reply to the said notice. On going through Exts. P9 to P12, it is found that there are no extra ordinary circumstances made out, to entertain the writ petition by exercising the plenary powers of this Court under Article 226 of the Constitution of India, and set aside Ext. 12 order. It would be up to the petitioner to invoke his statutory remedies as provided under the GST Acts. The writ petition is dismissed.

Summary

Issues involved:
The judgment involves the quashing of a confiscation order passed by the first respondent under the GST Acts.

Factual Matrix:
The petitioner, a registered dealer under the GST Acts, filed monthly returns and availed Input Tax Credit. The petitioner sold iron scrap to a dealer in Goa and the goods were intercepted during transit. Notices were issued for physical verification, leading to a confiscation order.

Contentions:
The petitioner argued that proceedings should have first been initiated under Section 129 before Section 130 of the CGST Act. The petitioner claimed that the registration certificate and documents disprove fake supplies. The government pleader contended that the petitioner engaged in fraudulent activities and evaded GST, urging dismissal of the petition.

Legal Analysis:
Section 130 of the CGST Act allows for confiscation of goods or conveyances in case of contravention with intent to evade tax. The post-amendment regime treats Sections 129 and 130 as independent. The first respondent issued a show cause notice under Section 130, leading to the confiscation order.

Decision:
The court found no extraordinary circumstances to set aside the confiscation order and dismissed the writ petition. The petitioner was advised to pursue statutory remedies under the GST Acts. The judgment highlights the importance of following due process under the GST laws.