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2021 (6) TMI 40 - Commissioner - GSTConfiscation of seized goods which were lying in the unregistered godown - search and seizure of godown - business carried out from unregistered premises with an intent to evade - penalty on proprietor - HELD THAT - M/s. Taj Iron Store, 25, Dudu Bagh. Loha Mandi, S.C. Road, Jaipur intentionally did not declare the additional place of business i.e. godown situated at S.P. 636, A3 Road No. 6, V.K.I Area, Jaipur in their GST Registration and carried out the business activities from the unregistered place. Further, the appellant could not produce any corroborative evidence in support of their claim that they had applied for amendment in registration of additional place of business i.e. godown. The appellant declared said premises (godown) as an additional place of business in its registration certificate by amending the registration certificate on 17-9-2018 only after search of the godown and seizure of the goods. It clearly shows their mala fide intention with intent to evade GST. Confiscation of goods - HELD THAT - Appellant have contravened the provisions of Sections 22 (read with Rule 11 of CGST Rules, 2017), 35, 37, 38 39 of the CGST Act, 2017 by storing dutiable goods illegally at an unregistered premise, without any authority of law and also by wrongly accounting for seized goods in their books of account and also not shown the same properly in periodical returns filed by them with the sole intent to evade payment of CGST/SGST. Therefore, the impugned goods i.e. Angle, Channel, Shape, Section, Beam, MS Bar, Flat, Gate Channel, MS Pipe etc., valued at ₹ 5,53,10,466/- stored at the godown of M/s. Taj Iron Store, seized vide GST INS-02 under Panchnama dated 13-9-2018 under Section 67(2) of the CGST Act, 2017 were liable for confiscation under Section 130 of the CGST Act, 2017 read with Rule 139 of the CGST Rules, 2017 and M/s. Taj Iron Store is also liable for penalty under Section 122(1)(xvi) and 122(1)(xviii) of the CGST Act, 2017 and also under Section 125 of CGST Act, 2017. Penalty on Shri Mohd. Riyaz Khan, Proprietor of M/s. Taj Iron Store who was looking after the day to day affairs of the Firm - HELD THAT - He has abetted and assisted in activities of storing dutiable goods at unregistered premise, without any authority of law and dealing in impugned goods which he knew were liable to confiscation and rendered himself liable to penalty under Section 122(3) and Section 125 of the CGST Act, 2017. Appeal dismissed - decided against appellant.
Issues Involved:
1. Registration of additional place of business. 2. Seizure and confiscation of goods. 3. Imposition of penalties under various sections of the CGST Act, 2017. 4. Procedural lapses during search and seizure. 5. Applicability of judicial precedents. Issue-wise Detailed Analysis: 1. Registration of Additional Place of Business: The appellant, M/s. Taj Iron Store, failed to register their additional place of business (godown) situated at S.P. 636, A3, Road No. 6, V.K.I. Area, Jaipur. Despite claiming that this was a bona fide error and presenting evidence such as rent agreements, tally ledgers, purchase invoices, and tax invoices showing the godown's address, the adjudicating authority found that the appellant intentionally did not declare the additional place of business in their GST Registration. The appellant's claim that they attempted to amend their registration but faced technical issues was not substantiated with documentary evidence. The adjudicating authority concluded that the appellant's actions contravened Section 22(1) of the CGST Act and Rule 11 of the CGST Rules, 2017. 2. Seizure and Confiscation of Goods: During the search on 13-9-2018, unrecorded stock of goods valued at ?5,53,10,466/- was found at the unregistered godown and seized under Section 67(2) of the CGST Act, 2017. The adjudicating authority ordered the confiscation of these goods under Section 130 of the CGST Act, 2017, but provided an option to redeem the goods on payment of a redemption fine of ?99,55,880/-. The appellant argued that there was no stock difference and that the seizure was merely due to a procedural lapse. However, the adjudicating authority held that the goods were stored illegally and thus liable for confiscation. 3. Imposition of Penalties: The adjudicating authority imposed penalties on M/s. Taj Iron Store and its proprietor, Shri Mohammed Riyaz Khan, under various sections of the CGST Act, 2017: - A penalty of ?99,55,880/- under Section 122(1)(xvi) and Section 122(1)(xviii) of the CGST Act, 2017. - A penalty of ?25,000/- under Section 125 of the CGST Act, 2017. - A penalty of ?25,000/- under Section 122(3)(a) and Section 125 of the CGST Act, 2017 on Shri Mohammed Riyaz Khan. The adjudicating authority found that the appellant's actions demonstrated a mala fide intention to evade GST, justifying the penalties imposed. 4. Procedural Lapses During Search and Seizure: The appellant contended that the search and seizure procedures were unlawful, citing non-compliance with Section 100 of Cr.PC. and other procedural lapses. They argued that the panch witnesses did not offer their personal search, and documents/equipment resumed during the search were not relied upon in the Show Cause Notice (SCN). The adjudicating authority dismissed these claims, stating that the panchnama proceedings and statements recorded were lawful and that the appellant's acceptance of the panchnama contents negated their procedural lapse arguments. 5. Applicability of Judicial Precedents: The appellant cited various judicial precedents to support their case. However, the adjudicating authority found these precedents inapplicable, as the facts of those cases differed from the present case. The authority emphasized that the appellant's failure to declare the additional place of business and the subsequent discovery of unrecorded stock justified the actions taken under the CGST Act, 2017. Conclusion: The appeals filed by the appellants were rejected. The adjudicating authority upheld the confiscation of goods and the imposition of penalties, concluding that the appellants had intentionally failed to comply with the provisions of the CGST Act, 2017, with the intent to evade tax. The procedural lapses claimed by the appellants were dismissed, and the judicial precedents cited were deemed inapplicable.
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