2024 (11) TMI 1170 - HC - GST

Levy of penalty u/s 129(1)(b) of the Central Goods and Services Tax Act, 2017 read with Section 20 of the Integrated Goods and Services Tax Act - HELD THAT - From a perusal of the documents annexed with the writ petition, it appears that the authorities have not challenged the invoice and/or e-way bill produced by the petitioner nor have they questioned the fact of purchase of the areca nuts from a third party which was then being supplied by the petitioner to the consignee. The petitioner also relies on the Circular No.76/50/2018-GST, dated December 31, 2018 that states that if the invoice or any other specified document is accompanying the consignment of goods, then either the consignor or the consignee should be deemed to be the owner. Reliance placed on the Division Bench judgment of this Court in the case of H/S HALDER ENTERPRISES VERSUS STATE OF U.P. AND OTHERS 2023 (12) TMI 514 - ALLAHABAD HIGH COURT wherein it has been held that the Department is bound by the aforesaid circular dated December 31, 2018 and if the invoice mentions the name of the consignor, the consignor shall be deemed to be the owner. The order dated November 6, 2024 is illegal and unjustified, and accordingly, the same is quashed and set-aside with a direction upon the authorities to pass an order under Section 129(1)(a) and thereafter release the goods and vehicle upon payment of the penalty in accordance with law. The writ petition is disposed of.

Summary

The High Court of Allahabad quashed a penalty order dated November 6, 2024 under the Central Goods and Services Tax Act, 2017. The court referred to Circular No.76/50/2018-GST and a Division Bench judgment to rule in favor of the petitioner. The order was deemed illegal and set aside, directing authorities to pass a new order under Section 129(1)(a) for release of goods and vehicle upon penalty payment. The writ petition was disposed of.