2021 (1) TMI 489 - HC - GST

Imposition of penalty under Section 122(xiv) of the CGST Act - detention of goods and vehicle on the ground that vehicle was not carrying the valid e-way bill - whether the Superintendent of State Tax has exceeded his jurisdiction in imposing the penalty? - HELD THAT - For the breach which falls under Section 122(xiv), the penalty is fixed @₹ 10,000/-. So far the penalty for an amount equivalent to tax is concerned those are for the incidents when the tax is sought to be evaded or not deducted under Section 51 etc. The other incidences as cataloged in Section 122 of the CGST Act are not relevant to the present case and as such we are of the firm view that the Superintendent of State Tax has exceeded his jurisdiction while imposing the penalty. The penalty would have been ₹ 10,000/-. As there is no dispute about the tax, we will not lay our hands on that aspect. Mr. Majumder has categorically stated that the petitioner has paid the said tax. We are also not accepting that statement on the face of it. The revenue authority shall be at liberty to verify that fact to ascertain whether tax has been paid or not. In the event of non- payment of tax the appropriate action be taken for realizing the said tax from the petitioner. But in the circumstances, we set aside the order of penalty and direct the petitioner to pay the sum of ₹ 10,000/- as penalty for the breach which is covered under Section 122(xiv) of the CGST Act within a period of 1 month from today. If not paid, the action as prescribed by the statue be followed for realizing the same. Petition stands partly allowed.

Summary

Issues:
Challenge to tax liability and penalty for not carrying valid e-way bill.

Analysis:
- The petitioner challenged an order determining liability for CGST and SGST, along with a penalty for not producing a valid e-way bill for a consignment. The taxing authority issued a detailed notice under relevant sections of GST Acts, focusing on the absence of a valid e-way bill as the main violation.
- The petitioner explained that due to a breakdown of the original vehicle during lockdown, they could not produce a new e-way bill for trans-shipment. The taxing authority imposed a penalty equivalent to the tax payable for this violation.
- The taxing authority cited Section 122(xiv) of the CGST Act, 2017, which covers transporting taxable goods without specified documents, as the basis for the penalty. The petitioner, a regular tax filer, argued that the breach was unintentional and not fraudulent, attributing it to abnormal lockdown circumstances.
- The court noted that while the breach fell under Section 122(xiv), the penalty imposed exceeded the statutory limit, which should have been ?10,000. The court directed the petitioner to pay the reduced penalty within a month, setting aside the excessive penalty imposed by the taxing authority.
- The court did not dispute the tax liability, leaving it to the revenue authority to verify if the tax had been paid. If unpaid, appropriate action was to be taken to recover the tax. The court partially allowed the petition, requiring payment of the reduced penalty within the specified timeframe.

This detailed analysis of the judgment highlights the issues, arguments, legal provisions, and the court's decision regarding the challenge to tax liability and penalty for not carrying a valid e-way bill in a GST-related case before the Tripura High Court.