2024 (5) TMI 514 - HC - GST

Levy of penalty - non filling up of Part B of the e-Way Bill - existence of mens rea or not - HELD THAT - In the present case the facts are quite similar to one in M/S CITYKART RETAIL PVT. LTD. THRU. AUTHORIZD REPRESENTATIVE VERSUS THE COMMISSIONER COMMERCIAL TAX U.P. GOMTI NAGAR LKO. AND ANR. 2022 (9) TMI 374 - ALLAHABAD HIGH COURT and there are no reason why this Court should take a different view of the matter as the invoice itself contained the details of the truck and the error committed by the petitioner was of a technical nature only and without any intention to evade tax. Once this fact has been substantiated there was no requirement to levy penalty under Section 129(3) of the Act. It is further noted that the respondents have not been able to indicate any mens rea on the part of the petitioner for evasion of tax. Such being the case it is clear that penalty under Section 129(3) of the Act cannot be sustained. Petition allowed.

Summary

Issues involved:
The issues involved in the judgment are the imposition of penalty under Section 129(3) of the Uttar Pradesh Goods and Services Tax Act, 2017 for non-filling of Part 'B' of the e-Way Bill, and the absence of intention to evade tax.

Imposition of Penalty:
The petitioner challenged an order levying penalty under Section 129(3) of the Act for not filling up Part 'B' of the e-Way Bill, along with the dismissal of the appeal against the said order. The record shows that the controversy solely pertains to the non-filling of Part 'B' of the e-Way Bill. It is undisputed that the invoice contained details of the truck carrying the goods, the goods matched the invoice, and there was no evidence of the petitioner's intention to evade tax. Citing precedents, the petitioner argued that the mere non-filling of Part 'B' without intent to evade tax should not lead to penalty imposition.

Legal Precedents and Arguments:
The petitioner referenced judgments in VSL Alloys (India) Pvt. Ltd v. State of U.P. and M/s Citykart Retail Private Limited cases to support the argument that non-filling of Part 'B' without intent to evade tax should not attract penalty under Section 129(3). The appellate authority confirmed the non-filling of Part 'B' as per the petitioner's contention.

Judicial Analysis and Decision:
Comparing the present case to M/s Citykart Retail Pvt. Ltd.'s case, the Court found similarities and concluded that the technical error of not filling Part 'B' without intent to evade tax should not warrant a penalty. The absence of mens rea on the petitioner's part for tax evasion further supported the decision to quash the orders dated December 22, 2021, and January 20, 2022. Consequently, the petition was allowed, and the respondents were directed to return the security to the petitioner within six weeks.