2021 (10) TMI 475 - HC - GST

True owner of goods which have been seized - Section 129(3) of the UP GST Act, 2017 - HELD THAT - Undisputedly, show cause notice was issued on 17.08.2021 calling for a reply by 23.08.2021. While the petitioner claims to have submitted his written reply on 23.08.2021, he further claims to have deposited ₹ 1,37,232/- through on-line mode on 23.08.2021 itself being amount equivalent to the tax payable on the goods detained and the penalty calculated at the rate equal to tax. Proof of that payment has been annexed as Annexure No. 7 to the writ petition. While Shri C.B. Tripathi would contend that the goods are not traceable to a bona-fide owner at the same time, in the facts of the present case, it does appear that the impugned order dated 24.08.2021 had been passed without consideration of the petitioner's claim to ownership over the goods in question. Conclusion that may have been drawn contrary to the claim of the petitioner is exparte. At the same time, there is evidence of the petitioner (claiming as owner) having deposited the amount of ₹ 1,37,232/- on 23.08.2021 which was the date fixed in the proceedings initiated under the notice dated 17.08.2021 issued under Section 129(3) of the Act. The order dated 24.08.2021 cannot stand, as the same appears to have been passed ex-parte against the petitioner without consideration of his claim. The order dated 24.08.2021 is hereby set aside - matter is remitted to the respondent no. 2 to pass a fresh order after considering the petitioner claim over the goods. the petitioner shall appear before the respondent no. 2 on 13.10.2021 - Petition allowed by way of remand.

Summary

Issues: Challenge to order under Section 129(3) of UP GST Act, 2017 regarding ownership of seized goods.

Analysis:
The petitioner challenged an order passed under Section 129(3) of the UP GST Act, 2017, claiming ownership of goods seized during transportation. The petitioner purchased the goods from a dealer in Bihar and was intercepted by authorities in Meerut. A show cause notice was issued, and the petitioner submitted a written reply along with online payment equivalent to the tax and penalty. The petitioner contended that the respondent erred in not acknowledging his ownership claim, making the demand illegal. The respondent argued that the goods were not traceable to a bona fide owner, but it was noted that the impugned order was passed without considering the petitioner's ownership claim, leading to an ex-parte decision. The petitioner's payment and claim as the owner were considered, leading to the setting aside of the order dated 24.08.2021.

The court found that the order was passed ex-parte against the petitioner without due consideration of his claim over the goods. Therefore, the order dated 24.08.2021 was set aside, and the writ petition was allowed. The matter was remitted to the respondent to pass a fresh order after considering the petitioner's claim. The petitioner was directed to appear before the respondent, who was instructed to issue an appropriate order within a week. All consequential proceedings were to abide by the order passed by the said authority in compliance with the court's decision. The judgment emphasized the importance of considering the petitioner's ownership claim and conducting a fair assessment before passing any orders under the relevant provisions of the Act.