2024 (7) TMI 1037 - HC - GST

Detention of goods - inference drawn that the goods is likely to be unloaded at distt. Hapur without having proper documents - goods detained only on the basis of surmises and conjunctures that the goods were not on its normal route and driver of the goods was having mobile number of one dealer of distt. Hapur - HELD THAT - It is not in dispute that the goods were coming from Distt. Muzaffarnagar and same was intercepted during transit. As per the document accompanying with the goods in question, no discrepancy was found. Further the goods in question were going up to Distt. Ghaziabad and same was intercepted at distt. Hapur under the pretext that it was not on its normal route as well as the driver of the truck was having mobile number of a dealer of Distt. Hapur, therefore, inference has been drawn that the goods in question will be unloaded at distt. Hapur without having any proper document. The respondent authorities have not recorded any finding with regard to intention to avoid the payment of tax, in other words the mens ria is absent. Once there is no finding with regard to mens ria to avoid the payment of tax, the impugned order cannot be sustained in the eyes of law on this ground also. The impugned orders dated 30.7.2020 and 10/11.12.2019 are hereby quashed - Petition allowed.

Summary

Issues:
Challenging detention of goods during transit without evidence of tax evasion or discrepancies in documents.

Analysis:
The petitioner sought relief through a writ petition to quash orders related to the detention of goods in transit. The petitioner's counsel argued that the goods had all required documents during interception, with no quality or quantity issues. The detention was based on assumptions that the goods were off-route and might be unloaded without proper documentation. The counsel emphasized that under GST, there is no requirement to disclose the route before movement, unlike the previous VAT regime. The petitioner's route change was justified due to heavy traffic, but the goods were still detained. Referring to a previous judgment, the counsel highlighted that seizure should not occur if genuine documents accompany the goods, and no tax evasion intent is proven.

The Additional Chief Standing Counsel supported the detention, alleging potential tax evasion as the goods were near a different district. However, no findings indicated tax avoidance intent or document discrepancies. The court noted that GST laws do not mandate disclosing specific routes for goods transportation. Citing the previous case law, the court emphasized that detention and seizure can only occur if genuine documents are missing, which was not the case here. Since there was no proof of tax evasion intent, the court allowed the writ petition, quashing the impugned orders and ordering a refund of any deposited amounts by the petitioner within a month.